Overview
- Global oil prices dropped sharply in June after a temporary US‑Iran truce and prospects of the Strait of Hormuz reopening, easing a key source of imported inflation for energy importers.
- India’s consumer price index rose to 3.9% in May, and the Reserve Bank of India warned of fuel pass‑through and weaker consumer confidence even as economists now largely expect any repo hikes to be deferred into the second half of FY27.
- Canada’s annual inflation unexpectedly accelerated to 3.2% in May but market‑implied odds show a near‑zero chance of a Bank of Canada rate move on July 15 and only modest chances later in the year.
- Australia’s headline CPI fell to 4.0% for May but the RBA’s preferred trimmed‑mean measure climbed to 3.6%, leaving the central bank under pressure to consider further tightening despite the softer top line.
- Markets and central banks are now split: futures and economists have trimmed near‑term hike bets because of lower oil, yet core inflation measures and domestic factors such as housing, food prices, and fuel pass‑through mean policy paths remain uncertain and warrant close monitoring.