The benchmark ASX 200 index slid 1% to 7,217, while the wider All Ordinaries index fell little over 1% to 7,515. Meanwhile, the Australian currency was trading at 71.22 US cents, down 0.6 percent. Investors reacted to Reserve Bank of Australia governor Philip Lowe’s statements before a parliamentary hearing that a rate hike later this year was “plausible.”
The Australian stock market fell on Friday, as investors worried about a rate hike in 2022 and US inflation reaching a 40-year high.
Dr. Lowe, on the other hand, warned that raising interest rates too soon could jeopardize the country’s employment targets, and that the board was prepared to wait.
“I believe that collecting one more CPI [consumer price index] is insufficient to produce that evidence,” he stated.
This effectively rules out a rate hike before the RBA’s meeting in August. The top 200 firms index was dragged down by rate-sensitive industries like real estate and technology.
Block, the parent company of Afterpay, fell 3.4 percent, while Xero fell 4.5 percent and WiseTech Global fell 3.4 percent.
IDP Education (-8%), Zip Co (-7.1%), Life360 (-6.7%), Pointsbet Holdings (-6.5%), and Megaport (-6.5%) were the worst-performing businesses at lunchtime (-6.5pc).
Unibail-Rodamco-Westfield (+6.4%) and Insurance Australia Group (+4.1%) were the best-performing stocks, with Unibail-Rodamco-half-year Westfield’s cash earnings down 62 percent but still above predictions. The top five companies were Rio Tinto (+2.9%), ALS Limited (+2.6%), and Fortescue Metals (+2.7%).