As we step into the first month of winter and approach the end of the financial year, attention is turning to the resilience of the economy and households.

May delivered mixed signals for the Australian economy.

Inflation eased slightly to 4.2% in April from 4.6% in March, although underlying inflation edged higher from 3.3% to 3.4%.

The softer-than-expected inflation data reduced expectations of further rate hikes in the near term.

Australian share markets were volatile.

The ASX 200 moved within a relatively narrow range through the month, slipping slightly overall despite periods of strength linked to resources and AI‑related stocks.

Globally, markets continued to be shaped by Middle East tensions and ongoing inflation concerns.

US markets made some big gains with the S&P 500 hitting an all-time high in the final days of May.

Oil prices eased from April highs but remained elevated and volatile with renewed US air attacks in Iran risking high prices still.

Consumer sentiment improved modestly although households remain deeply pessimistic because of high interest rates and cost‑of‑living pressures.

This pessimism is extending to the property market which is showing signs of a broad-based softening.

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