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RBA faces shifting data as oil spikes after June sentiment uptick

National Australia Bank says business conditions held steady in June, while price pressures eased, but the survey’s disinflation signal is being overtaken by a fresh rise in Brent crude and renewed Middle East risk.

Reported · Written up by our desk · Central Banks

Australian business sentiment improved in June in a National Australia Bank survey, but the data may be quickly outdated as fuel and geopolitical conditions changed after the survey window, according to Forexlive.

NAB reported business conditions were unchanged at +3 for a third straight month, while confidence improved to -5 from -14 in May. Forexlive said the survey’s better outlook was linked to a U.S. and Iran agreement that ended a multi month conflict and eased a global energy shock, along with a noticeable slowdown in price pressures.

The report also pointed to disinflation signals, with product price growth slowing back to its February level and retail prices falling for the first time in seven years. Forexlive noted the Reserve Bank of Australia has raised rates three times this year to 4.35%, and that further tightening remains on the table.

Forexlive said the assessment is being tested as renewed tensions have prompted U.S. military strikes on Iran and a reinstatement of its naval blockade of shipping through the Strait of Hormuz. Brent crude jumped about 2% to around $85 a barrel, its highest level since mid June, pushing the RBA into a more complicated policy backdrop.

Latest closeWTI crude $78.04 ▲9.3%|Brent $83.15 ▲9.4%

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