Brent crude has risen back above $101 a barrel following attacks by Yemen’s Houthi rebels on targets in southern Saudi Arabia. The renewed escalation has revived fears over energy supply security and is feeding directly into inflation expectations that policymakers had hoped were receding.

The Reserve Bank of India raised its repo rate by 25 basis points to 5.5% this week, its first hike since February 2023. As a major energy importer, India is particularly exposed to the current fuel squeeze, and the central bank’s move signals that higher energy costs are now working their way into consumer prices fast enough to demand a policy response. Investors are watching for further central banks to follow suit.

In the UK, financial markets are pricing in a greater than 90% probability of a quarter-point Bank of England rate rise after its November meeting, with three additional increases expected through 2027. That trajectory has already drained the market of cheaper mortgage deals. Lloyds data showed UK house prices were flat in September and recorded a 0.2% quarterly decline, following the first annual fall since 2023 recorded in August. New mortgage enquiries are running at their fastest pace since February, suggesting buyers have not exited the market entirely but are proceeding with considerably more caution.

The Strait of Hormuz remains a live flashpoint. Multiple incidents involving tankers were reported by the UKMTO , the Royal Navy-led maritime security monitor, in the past week. Insurance premiums have risen sharply in response, while longer rerouting times are compounding freight costs.

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