11.09.202606:37:23UTC+00ASX Retreats 3.0% Weekly as Inflation Fears Mount

The ASX 200 fell 78 points, or 0.9%, to close at 8,741 on Friday, its lowest level in seven weeks. The benchmark index declined for a fourth consecutive session and posted its steepest weekly loss in six months, dropping 3.0%. Risk appetite weakened as a sharp rise in crude oil prices cast doubt on a swift moderation in Australia’s inflation.

Reinforcing those concerns, RBA Deputy Governor Hauser said additional rate hikes will be on the table at the September meeting, while Assistant Governor Hunter warned that the central bank has little tolerance for renewed cost pressures. Australia’s 10-year government bond yield surged above 5.3%—its highest level since May 2011—tracking gains in U.S. Treasuries and strengthening expectations of tighter borrowing conditions.

Losses were broad-based, led by healthcare, non-energy minerals, technology, and consumer stocks. Major miners were under heavy pressure, with BHP down 4.3%, Rio Tinto 3.7% lower, and Fortescue off 2.4%. South32 dropped 4.4%, Northern Star Resources fell 2.3%, and Evolution Mining slipped 2.0%. In contrast, the big four banks advanced, gaining between 0.6% and 2.5%.