The coalition might be enjoying a “reset” under new leadership but a test for the parties’ mended relationship is coming fast.

Newly elected Liberal leader Angus Taylor announced on Tuesday that suspended Nationals would be reinstated to the front bench when he unveiled his shadow ministry.

He allowed the Nationals MPs and senators serving a six-week suspension, part of the coalition reunion negotiated by ousted leader Sussan Ley and Nationals leader David Littleproud, to return to their roles immediately.

The coalition’s messy split occurred in January and lasted 17 days after a row over hate speech laws that were made in response to the Bondi terror attack.

Ross Cadell, who was one of the three Nationals senators who crossed the floor over the contentious laws, said Mr Taylor waiving the suspension was “the reset that the coalition needed”.

“We had problems right from the beginning last time with the split. This is an unexpected and welcome accommodation,” he told AAP.

“If you want to know about the relationship, Littleproud and Angus had dinner on Friday night and got on well. 

“I don’t think I ever heard of David and Sussan sharing a cup of tea, let alone having a meal.”

Nationals MP Michael McCormack said Mr Taylor would bring a fresh approach to the coalition.

“Angus has obviously seen that it would be sensible to bring the National Party shadow ministers back into the … that’s appropriate, that’s sensible, that’s practical,” he said.

The shadow ministry reshuffle comes after Mr Taylor ousted Ms Ley in a party room spill last week after dire polling and infighting sparked calls for a leadership change.

A by-election looms for Ms Ley’s long-held seat of Farrer after she announced her resignation from parliament.

The two coalition partners do not typically compete against each other in most seats, but Farrer, which includes Griffith and the border city of Albury, is an exception.

The real test in the coalition’s “rejuvenated” relationship might lie in how the by-election unfolded, ANU political expert Zareh Ghazarian said.

“That may potentially be a point of friction between the two parties … it might pit them against each other,” Dr Ghazarian said. 

“It will be interesting to see the tone and the temperament of the debate between the coalition parties.

“That will give us a sense in real time about how the rejuvenated coalition is operating.”

Asked whether Mr Taylor and Mr Littleproud struck a new coalition agreement, deputy Liberal leader Jane Hume would not be drawn on details. 

“That’s not something we talk about it public,” she told ABC TV.

“They’ve spoken to each other every single day since they have a very good working relationship, and I’m really looking forward to now the coalition uniting.”

Australia’s unemployment is widely tipped to be on the rise once again following a surprise fall.

The Australian Bureau of Statistics will release the first lot of labour force figures of 2026 on Thursday, with a slight rise to 4.2 per cent for January expected.

A fall in the seasonally adjusted rate to 4.1 per cent in December took forecasters by surprise.

NAB senior economist Taylor Nugent said a course correction was on the cards for January’s data.

It’s expected 20,000 more jobs will be added to the economy for the month.

“The past three Januarys have seen a 10 to 15 basis point rise in the unemployment rate that was partially reversed in February, because there have been more people unemployed but attached to a job they were waiting to start than was normal prior to the pandemic,” Mr Nugent said.

“That effect does seem to be fading year by year but after the surprise two-tenths fall in December, it does support the expectation for some reversal in January.”

The surprise drop in jobless numbers was driven by a rise of 65,000 employed people for December, with more 15 to 24-year-olds moving into work.

Wage figures released on Wednesday showed pay packets were not keeping up with inflation.

Seasonally adjusted wages rose to 3.4 per cent for the year to December, but below the 3.8 per cent for annual inflation.

It’s the first time there has been a drop in real wages since September 2023.

Treasurer Jim Chalmers did not say when he expected salaries to be above the rate of rising costs.

“It’s clear from the Reserve Bank’s forecasts that the inflation number will be higher than we’d like for a little while now this year,” he said.

“They’ve got inflation peaking around the middle of the year and then coming down after that, and that will have implications for real wages.”

The Prince of Wales has said there is a need for more “male role models” to talk about and normalise understanding of men’s mental health.

Prince William appeared on an episode of BBC Radio 1’s Life Hacks and opened up about how he takes a “long time” to understand his emotions during a panel discussion about mental health and suicide prevention. 

“We need more male role models out there talking about it and normalising it so that it becomes something that is second nature to all of us,” the prince said.

“Not one person in this world has all the tools for every eventuality or mental state that is going to come across. 

“I like to go around looking for new tools to put in my toolbox when I might need it and if we look at it like that, it does normalise the idea that the brain just needs sometimes a little bit of help.

“It’s OK to ask for support, ask a mate, reach out.”

Over the course of the hour-long episode he also opened up about his own mental health and the importance of learning to love who you are as well as taking time to understand how you feel. 

“I take a long time trying to understand my emotions and why I feel like I do,” he said.

“And I think that’s a really important process to just do every now and again to check in with yourself and work out why you’re feeling like you do. Sometimes there’s an obvious explanation, sometimes there isn’t. 

“If we talk about that more and educate people more, then hopefully the idea of suicide gets keeps being pushed further and further away because you know that tomorrow actually you might wake up and you might feel very different.” 

William also recalled a time where he noticed his mental health was “deteriorating” after working as a pilot for the air ambulance service between March 2015 and July 2017, and the importance of taking “stock” of how you are feeling. 

He said: “If you listen to the body and have time to process your thoughts and your feelings, it will present itself to you. 

“It’s really important you have those moments where you take stock.

“It wasn’t until I stepped away from it on a sort of longer break that I looked at myself and went, ‘My god, I’m carrying everyone’s emotional baggage’. 

“It was really weighing me down.” 

The Prince of Wales continued to explain how the nature of emergency service jobs can take its toll on people due to how emotionally and physically demanding the work can be. 

He said: “It’s not until you step away from it, either that you retire or you have a break, which many of them don’t get long enough breaks, are you able to process what kind of attritional, mental, emotional experiences you’re having each time. “

The prince said he was “quite emotionally available”, but it sometimes came at a cost. 

“It helps me put my own life into perspective but also I carry with me their burden sometimes and that’s the bit I find very difficult is I feel other people’s pain and that overwhelms me sometimes,” he said.

“You want to fix it but you can’t necessarily fix some of the stuff and emotionally I find that very challenging.”

British inflation fell to its lowest since March 2025, according to official data that strengthens the case for an interest rate cut soon ‌by the Bank of England, even as a measure of underlying price pressures remains strong.

Consumer prices rose by 3.0 per cent in annual terms in January, slowing from a 3.4 per cent increase in December, the Office for National Statistics said, as transport, food and non-alcoholic drink prices rose less quickly.

Most economists polled by Reuters had expected headline inflation to drop to three per cent in January. 

The BoE projected earlier in February that ‌it would ease ‌to 2.9 per cent before a ⁠bigger fall in April to almost the central bank’s two per cent target.

Food inflation – which the ​central bank sees as key for shaping public expectations about prices more broadly – was the weakest since April 2025. 

Airline fares fell sharply on the month after jumping in December.

Core inflation, excluding energy, food and tobacco prices, rose by 3.1 per cent in January, its lowest rate since September 2021.

Sterling was little changed against the US dollar after the ONS data on Wednesday. 

Interest rate futures put an almost 80 per cent chance on a March ⁠rate cut by the BoE followed by another in late 2026.

Some warning signs remained for the BoE in Wednesday’s data.

Inflation for services – closely watched as a gauge of domestic price pressures – slowed only ​marginally to 4.4 per cent ‌from 4.5 per cent in December, above the Reuters poll expectations for a fall to 4.3 per cent.

“Given almost all the survey measures of prices ​suggest disinflation has slowed, the MPC will still have to be cautious this year, even as headline inflation drops,” said Thomas Pugh, chief economist at accountancy firm RSM UK.

“Indeed, services inflation is proving to be much stickier than headline inflation.”

British inflation ​has ​run higher than in the United States and in ​the euro zone where it stood at 2.4 per cent and 1.7 per cent, respectively, in ‌January.

The BoE expects the pace of price rises to slow sharply to almost its two per cent target in April as 2025’s rises in utility costs and other government-controlled tariffs fall out of the annual comparison.

Japan’s exports surged nearly 17 per cent in January from a year earlier, lifted by seasonal factors and strong demand in China and other Asian markets. 

Imports slipped 2.5 per cent from the same month a year earlier to 10.3 trillion yen ($A95 billion), while exports climbed 16.8 per cent to 9.19 trillion yen, the finance ministry reported on Wednesday.

That left a deficit of 1.15 trillion yen, less than half the trade deficit recorded a year earlier. 

Analysts noted that a key reason for the big jump early in 2026 was because the Lunar New Year occurs later than usual, falling on February 17. 

Japan’s economy depends heavily on exports and dramatic increases in tariffs by US President Donald Trump have taken a toll. 

The economy expanded at an anaemic 0.2 per cent annual pace in the last quarter, with growth for 2025 at just 1.1 per cent as weaker exports offset a modest increase in private consumption. 

Exports to the US fell 0.5 per cent in January, the latest data showed, while imports from the US rose three per cent. 

Exports to the US of vehicles, which account for about a third of the total, fell nearly 10 per cent. 

Despite antagonisms with Beijing over comments by Prime Minister Sanae Takaichi about Taiwan, Japan’s exports to China jumped 32 per cent year-on-year in January. 

Exports to all of Asia were robust, surging 26 per cent, the data show. 

Imports of semiconductors and other computer components showed the fastest growth, likely reflecting the impact of the boom in artificial intelligence, which has supercharged demand for data centre equipment and computer chips. 

“But the currently strong tailwind from the US AI boom is unlikely to last, suggesting that gains in exports to Asia excluding China will moderate,” Norihiro Yamaguchi of Oxford Economics said in a commentary.

He said exports were “highly likely to moderate” in March.

A state premier has ramped up a push to host a diplomatic summit that – if successful – would see Donald Trump become the first sitting US president to visit Australian soil in more than a decade.

In an address to the National Press Club in Canberra on Wednesday, Queensland Premier David Crisafulli laid out his vision for the state to hold the Quadrilateral Security Dialogue, or Quad.

The strategic partnership between Australia, India, Japan and the United States was formed in 2007 as a counterweight to Chinese influence in the Indo-Pacific region.

Mr Crisafulli also views it as a commercial opportunity that would put Queensland on the world stage ahead of the Brisbane Olympic Games in 2032.

The last sitting US president to visit Australia was Barack Obama in 2014.

Asked how President Trump might be persuaded to come to Australia for the summit, Mr Crisafulli said “the US needs that relationship and Queensland needs the US”, adding his state was “in the box seat”.

He said Queensland had critical minerals the US needed for military hardware and other advanced technologies.

“When you’re talking about minerals that might be used for night vision goggles or hard-facing for military equipment, it’s big business, but also in terms of security, it’s very important,” Mr Crisafulli said.

The US was over-reliant on sourcing its minerals from other nations and states that were less politically stable than Australia, he said.

“In some cases, the US is getting up to 90 per cent of these individual minerals from one jurisdiction,” Mr Crisafulli said.

“You wouldn’t do that in any industry, let alone when you’re talking about geopolitical instability and relationships that can fracture.

“I see this as the next wave for Queensland’s economy … I have a view that Queensland is better placed than anywhere else.”

Prime Minister Anthony Albanese was strongly supportive of Queensland hosting a future summit and funding had already been apportioned, Mr Crisafulli said.

There have been six Quad summits since 2021 – two in the US, two in Japan and two via video conference.

The last meeting, in September 2024, was held in the US state of Delaware and hosted by then-president Joe Biden.

India is due to host the next summit, with the date yet to be announced.

Australia was in line to host the following event, Mr Crisafulli said, noting Brisbane had previously hosted the G20 in 2014, attended by world leaders including then-president Obama.

Australia withdrew from the Quad in 2008 under Kevin Rudd’s Labor government.

The strategic partnership was resumed in 2017 when Australia re-entered under the coalition, then led by Malcolm Turnbull.

The Chinese government has previously issued official diplomatic protests to member nations to oppose the partnership.

Christine ‌Lagarde is expected ‌to leave ‌the European Central Bank before ‌the ‌end ⁠of her ​eight-year term as president, the ⁠Financial Times ‌reports, citing ​a person ‌familiar with ​her thinking.

Reuters could ​not ​immediately ​verify ‌the report.

The ECB did not ‌immediately respond to ​Reuters’ request for comment.

Lagarde wanted to ​exit ​the ​bank before the ‌French presidential election in April 2027, the FT said.

Alcoa has been given the green light to clear more Australian forest after being fined for stripping land for bauxite mining without approvals.

The US aluminium giant has agreed to pay $55 million to restore the environment as part of an enforceable undertaking reached with the federal government on Wednesday.

It relates to habitat destruction in the Northern Jarrah Forest, south of Perth, between 2019 and 2025.

“It’s the largest conservation‑focused commitment of its kind,” Federal Environment Minister Murray Watt said as he spruiked the deal.

The company did not seek the appropriate legal approvals to clear the land under the Commonwealth Environment Protection and Biodiversity Conservation Act 1999.

The agreement, which is enforceable in the Federal Court, will deliver permanent ecological offsets to preserve important habitat.

It will also expand conservation programs for species, including Western Australia’s three black cockatoo species, and strengthen invasive‑species management within the Northern Jarrah Forest.

Senator Watt also granted Alcoa a national‑interest exemption to allow the company to continue land clearing for its mining operations for 18 months, while a strategic assessment is completed.

This will ensure the continued supply of bauxite for industry in Australia and with trade partners, he said.

It also ensures Alcoa can sustain its operations, which employ about 6000 workers.

The miner has committed to pay $4.2 million in additional offsets for activities covered by the exemption for management of the environmental impacts.

The federal environment department and Alcoa have agreed to develop a strategic assessment agreement to enable future environmental approvals.

This will guide sustainable mining at Alcoa’s Huntly and Willowdale mining operations, around 100km south of Perth, until 2045.

“This agreement will enable government to assess the cumulative environmental impacts of Alcoa’s local mining operations and provide strong protections for threatened species and ecological communities, while offering Alcoa long-term operational certainty,” Senator Watt said.

Alcoa said modernising the approvals framework will provide a better understanding of the potential impacts of land clearing and mining on significant flora and fauna into the future.

The company will continue to limit clearing to 800 hectares per year and increase new rehabilitation rates annually to 1,000 hectares per year by 2027.

“We are committed to responsible operations and welcome this important step in transitioning our approvals to a contemporary assessment process that provides increased certainty for our operations and our people into the future,” Alcoa president and chief executive William F Oplinger said.

The strategic assessment will not impact an ongoing accredited environmental assessment of the future Myara North and Holyoake mine regions of the Huntly mine under WA and federal environment law.

The Minerals Council of Australia said the agreement was a pragmatic decision by Alcoa and the federal government.

Chief executive Tania Constable called on state and federal governments to “rapidly finalise” workable national environmental standards and assessment agreements to reduce mine approval delays.

One of the Australian cohort of so-called “ISIS brides” and their children has been barred from entering the country while trying to flee Syria.

The group of 34 women and children had tried to leave the Al Roj refugee camp in Syria on Monday with the intention of trying to make it to the capital Damascus and then on to Australia.

They were sent back because of an administrative issue, but Prime Minister Anthony Albanese promised that the government would not offer the partners and children of Islamic State members repatriation aid.

Home Affairs Minister Tony Burke said one of the group had been assessed by security agencies as meeting a threshold to be banned from entering the country, despite being a citizen.

“I can confirm that one individual in this cohort has been issued a temporary exclusion order, which was made on advice from security agencies,” Mr Burke said in a statement on Wednesday.

“At this stage, security agencies have not provided advice that other members of the cohort meet the required legal thresholds for temporary exclusion orders.”

A temporary exclusion order stops Australian citizens from returning to the country from overseas for up to two years if they are deemed a security risk.

The opposition has for days been calling for the government to take the step.

Mr Albanese earlier said the government was taking national security advice about the cohort in Syria.

“We will implement the law to its fullest capacity that we can. We want to make sure that Australians are kept safe,” he told reporters in Tasmania.

“These are people who chose to go overseas to align themselves with an ideology which is the caliphate, which is a brutal, reactionary ideology and that seeks to undermine and destroy our way of life.

“We are providing no assistance to these people, and won’t provide any assistance to these people, but we won’t breach Australian law.”

A mayor is urging Pauline Hanson to visit his community during Ramadan after the senator claimed suburbs in the area are unsafe because of its Muslim population.

The One Nation leader has been widely condemned for comments in an interview on Monday, saying there were “no good Muslims”.

In a subsequent interview on Wednesday, where she walked back parts of the remarks but also rejected criticism of it, she said suburbs such as Lakemba in western Sydney were unsafe because of its Islamic residents.

“It concerns me greatly that people can’t go into certain suburbs in this country now … they don’t want to go into certain suburbs and I’ve been there to Lakemba, you feel unwelcome,” she told ABC TV.

Canterbury Bankstown Council mayor Bilal El-Hayek, who represents the area that takes in Lakemba, said Senator Hanson’s comments were divisive at a time when unity was needed in the community.

“Lakemba is no different to any other suburb or shopping precinct and there is no crime issue at Lakemba,” he told Sydney radio station 2GB.

“This has to stop, it really has to stop, because we need to come together at a time when the country is hurting.”

The most recent census showed 61 per cent of Lakemba residents were Islamic, with the suburb hosting popular food markets at night for Ramadan.

Mr El-Hayek said he had invited Senator Hanson to attend the markets, which begin on Thursday.

“We receive over one million people, the majority are actually not of the Islamic faith,” he said.

“At the moment when we need to come together, it’s a shame to see people playing politics.”

When pressed about her comments on Wednesday, the Queensland senator backtracked on her remarks about there being no good Muslims.

“No, I don’t genuinely believe that,” she told ABC TV, adding a non-practising Muslim woman had run for election for One Nation.

“If I’ve offended anyone out there that doesn’t believe in Sharia law or multiple marriages or wants to bring ISIS brides in or people from Gaza who believes in the caliphate… then I apologise to you for my comment.

“But in general, that’s what they want: a world caliphate and I’m not going to apologise.”

Race discrimination commissioner Giridharan Sivaraman joined calls for the senator to apologise.

“Public figures have a responsibility to elevate our national conversation, not inflame tensions, divide us or undermine the dignity of others,” he said.

Australian National Imams Council president Shadi Alsuleiman strongly rejected the firebrand senator’s prior comments, saying they reflected a serious misunderstanding of Islam and the Muslim community.

“For many years, she has made inaccurate and harmful statements based on misinformation rather than genuine engagement,” he told AAP.

Senator Hanson dismissed the criticism from Islamic groups.

“Of course they’re going to say that, but I’ve heard more hateful things coming out of the mouths of imams giving their sermons on the streets of Sydney, and other places in Australia, but nothing’s been said about that,” she said.

Senator Hanson used her maiden speech to the Senate in 2016 to claim Australia was being “swamped by Muslims”, a repeat of her 1996 speech to parliament’s lower house about Australia “being swamped by Asians”.

More recently, she drew widespread condemnation when she wore a burqa in the senate.

One Nation has been out-performing the coalition in recent surveys, with the latest Newspoll showing the party gaining a 27 per cent primary vote compared to the opposition’s 18 per cent.