Steve Daghlian

Welcome to the CommSec Market Update.

Yeah, we already got off to a pretty soft start this morning.

We're down by more than three quarters of a percent at one stage with those renewed tensions that you mentioned in the Strait of Hormuz that push oil prices up by around 5% in overnight trade.

The US and Iran basically just exchanging attacks.

The American Navy providing safe passage for two US flagged vessels through the strait.

And then Iran striked a UAE oil port with drones.

They hit a South Korean commercial ship.

And then Donald Trump said that the US sank

Iranian boats.

So all of this not really helping markets.

It got us off to, you know, on the back foot this morning.

And then as you point out, the RBA handed down its interest rate decision this afternoon.

Yeah, so we'll wait and see exactly what happens from here.

We're a full six weeks out now from the next interest rate decision by the Reserve Bank.

They did point out, of course, in the press, Bullock did anyway, that the oil shock has made things much more complicated for the Reserve Bank.

The governor's saying that they'll be looking through some of the oil shock, or they have somewhat.

but they can't look through all of it because of the risks to inflation.

Of course, last week, we had underlying inflation coming in at three and a half percent, which is way higher than what the RBA wants, preferably they'd want inflation to be around that two and a half percent mark.

And she also pointed out that these rate hikes that we've had won't have an impact on lowering inflation for quite some time.

There's a delayed effect there.