Fuel Excise Ends, Markets Eye Inflation

• Markets opened the week on a stronger footing after President Trump announced fresh talks with Iran and outlined plans to reopen the Strait of Hormuz. While negotiations remain fluid, the prospect of easing tensions has briefly improved risk sentiment across global markets.
• Brent crude held below US$84/bbl, extending Friday’s decline as concerns over supply disruptions eased. Lower oil prices helped drive a rally in global bond markets, with US Treasury yields falling 5–6bps as inflation concerns moderated.
• Australia’s temporary fuel excise relief expired on Sunday, removing a key buffer against higher petrol prices. With fuel costs no longer subsidised, economists expect energy prices to become a larger contributor to inflation in the months ahead.
• Today’s Household Spending Indicator will provide another read on consumer resilience, with spending expected to rise 0.8% m/m following 1.3% growth in May. A stronger result would reinforce the view that household demand has remained resilient despite higher interest rates.
• Also on today’s calendar are ANZ-Indeed Job Ads, US trade data and JOLTS job openings.