The Australian share market ended higher on Wednesday after the latest quarterly inflation data renewed hopes of an interest rate cut by the Reserve Bank in February. The ASX 200 recorded its best session in a month, finishing at 8,447 points, driven by hopeful inflation data. Technology stocks notably gained 2%, contributing to the positive market sentiment.
Star Entertainment led with a 17.4% gain after announcing the sale of its events venue in Sydney. Treasurer Jim Chalmers expressed optimism, stating the country is making “very meaningful, very substantial and sustained progress” against inflation without negatively impacting the jobs market or shrinking the economy. Given the better-than-expected inflation data, there is increasing momentum for the Reserve Bank of Australia to cut interest rates in February.
Inflation data raises rate cut hopes
Previously, the odds of a February rate cut were around 25%, but following the positive inflation report, they have surged to 95%. Alan Oster, chief economist at NAB, indicated that the unexpected inflation data have prompted a review of the bank’s forecast for a February rate cut, suggesting it remains a challenging decision for the Reserve Bank.
The closure of Mosaic Brands’ entire portfolio means nearly 3,000 job losses and over 700 retail stores shutting down across Australia. The company, which entered voluntary administration last October, recently confirmed it would close its remaining brands, including Katies, Rivers, Millers, and Noni B. Despite efforts to find buyers for the remaining brands, administrators could not secure any deals, and all stores are expected to close by mid-April.
As the markets wrapped up for the day, business news continued with discussions on the implications of the inflation data and potential rate cuts. For more detailed analyses, tune into The Business at 8:45 PM AEDT.
