At home, the Consumer Price Index (CPI) increased by 1.4% in second quarter, beating economist expectations of a 0.9% rise. On an annualised basis inflation was 2.00%, above expectations of a 1.7% rate.
Trimmed mean CPI, which better measures the underlying trend in inflation, showed a rise of 0.7% in the June quarter, for an annual growth rate of 2.4%.
With core inflation now closer to the mid-point of the RBA’s 2% – 3% target band, it lessens the chance for an interest rate cut when it meets next month. All the sectors finished in the red, with materials and energy stocks the hardest hit.
All the big four banks closed weaker, with Westpac the worst performer, losing 0.7%. The mining majors weighed on the market as commodity prices fell. BHP and Rio Tinto lost 1.4% and 1% respectively.
The ASX 200 let go of 37 points (-0.8%) to settle at 4506.