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RBA leaves interest rates unchanged at 3.6%
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Gold stocks lead gains on ASX
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Energy stocks gain 1.5% after OPEC+ to cut more production
By Mehr Bedi April 4 (Reuters) - Australian shares closed marginally higher on Tuesday as the Reserve Bank of Australia (RBA) became the first central bank in a developed nation to halt tightening measures after the country's inflation levels began receding. The S&P/ASX 200 index finished 0.2% up at 7,236.00 points. The benchmark ended 0.6% higher on Monday.
Australia's central bank left its cash rate unchanged at
3.6% to break a run of 10 straight hikes, saying it wanted
additional time to assess the impact of past increases on the
economy and inflation.
Still, the RBA did warn that some further tightening of
monetary policy may well be needed to ensure that inflation
returns to target due to global developments and softer demand
at home.
Monthly CPI data from last week suggested that inflation has
peaked in Australia and goods price inflation is expected to
moderate over the months ahead.
"We expect inflation to recede more quickly than the RBA," Gareth Aird, an economist from Commonwealth Bank of Australia said. The decision to pause brings glad tidings for Australian home owners as the fastest tightening cycle on record in Australia had increased variable repayments on homes by tens of thousands of dollars and taken a toll on the industry. "The collapse of two major builders in the past week had sounded an alarm for the RBA as mounting pressure on operational and borrowing costs have started to show their effects," said analyst Glenn Yin of AETOS Capital Group.
Gold stocks rose 2.9%, tracking gains in bullion
prices, and were the top gainers on the benchmark index. Sector giants Newcrest Mining and Northern Star
Resources advanced 3% and 3.9%, respectively.
Energy stocks added 1.5% after oil prices jumped
overnight on OPEC+'s plan to cut production further. Sector heavyweights Woodside Energy and Santos rose 0.7% and 2.2%, respectively.
New Zealand's benchmark S&P/NZX 50 index ended the
session up 0.5% at 11,898.56.
(Reporting by Mehr Bedi in Bengaluru; editing by Uttaresh
Venkateshwaran)
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