A sense of relief swept across global markets midweek following reports of a temporary ceasefire agreement between the U.S. and Iran, allaying fears that have rattled the energy sector and upended the economic outlook since the war began. Oil prices pulled back from recent highs with Brent crude dropping below $100 per barrel on Wednesday. Yields on sovereign debt also fell, suggesting greater confidence among investors that economies would avoid a persistent oil-induced jump in inflation.

Central banks such as the Federal Reserve have faced an uncertain outlook, given the disruptions to oil and gas shipments in the Middle East and the corresponding spike in energy prices. The Labor Department’s consumer price index (CPI) report on Friday will offer the first look at U.S. inflation in March. Economists forecast that consumer inflation climbed to 3.3% year-over-year from 2.4% a month earlier, according to Dow Jones. Excluding energy and food prices, core inflation’s rise is expected to be milder, hitting 2.7% versus 2.5% previously. Fed officials are also likely to debate the health of the labor market when they meet again in late April. In an upside surprise for hiring, U.S. employment grew by 178,000 jobs in March, higher than the 59,000 jobs that economists polled by Dow Jones expected.

A new episode of The Outthinking Investor podcast examines macro implications from the Iran war and monetary policy challenges when navigating an energy shock. PGIM’s Daleep Singh, Vice Chair and Chief Global Economist, and Marc Sumerlin, former Deputy Director of the White House National Economic Council, also discuss geoeconomic competition, U.S. fiscal policy, and the impact of tariffs and AI on the labor market.