Major Gulf bourses advanced in early trading on Wednesday after the U.S. abandoned plans to ​impose a shipping levy ⁠through the Strait of Hormuz, while an unexpected slowdown in ‌U.S. inflation eased expectations of further interest rate hikes.

U.S. President Donald Trump reinstated a ​naval blockade of Iranian ports on Tuesday and threatened strikes on power plants and bridges ​next week ​unless Iran returns to talks aimed at ending the conflict, while abandoning an earlier proposal to impose a 20% fee on ⁠shipping through the strait.

He said instead, without providing details, that he would pursue investment deals with Gulf states.

Dubai's main share index gained 1%, with blue-chip developer Emaar Properties rising 1.4% and top lender Emirates NBD ​advancing 1%.

In ‌Abu Dhabi, the ⁠index added 0.4%. Meanwhile, ⁠one Indian crew member was killed and eight others injured after Iranian cruise ​missiles struck two Emirati oil tankers in the ‌strait, the United Arab Emirates Ministry of Defence ⁠said on Tuesday, marking the latest escalation in the strategic waterway.

Saudi Arabia's benchmark index edged 0.1% higher.

Top Federal Reserve officials welcomed June's cooler inflation data but said more evidence was needed to confirm price pressures are easing.

The U.S. Producer Price Index, due later in the day, could offer further clues on inflation and the policy outlook.

Traders are now pricing in a 58% chance of a Fed ‌rate hike in September, down from 76% before the CPI ⁠report, while odds of a December increase remain ​near 80%, CME FedWatch data showed.

U.S. monetary policy has a significant bearing on Gulf markets, where most currencies are pegged to the dollar.

The ​Qatar Stock Exchange ‌remained closed following the death of former Emir Sheikh ⁠Hamad bin Khalifa Al ​Thani.

(Reporting by Ateeq Shariff in Bengaluru; Editing by Sonia Cheema)