According to Sunny Nguyen of Moody's Analytics in a report, the escalating Middle East conflict has arrived at an inopportune moment for Australia's inflation outlook. The economist noted that this conflict occurred just weeks after the Reserve Bank of Australia raised the overnight cash rate to 3.85% to counter a significant inflation rebound expected by the end of 2025. She stated that, as Australia is a net energy exporter, rising global energy prices could boost the country's export earnings and government fiscal revenue; however, these benefits are often front-loaded and unevenly distributed. She added that increasing energy costs might also spur demands for higher wages, which could exacerbate service sector inflation. A tight labor market and active wage negotiations are likely to entrench this dynamic. She said, "An indefinite energy shock is the last thing the Reserve Bank of Australia wants to see."