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ASX 200 braces for a dip as inflation concerns loom

Published 24/06/2024, 08:41 am
© Reuters

Investing.com - The Australian Stock Exchange is likely to experience a downward shift as investors gear up for a potential increase in inflation. This could push the Reserve Bank towards hiking Australia's cash rate, contrasting the easing monetary policies of other central banks globally.

In the US, the Dow Jones Industrial Average remained steady, while the S&P 500 and the NASDAQ Composite both experienced a 0.2% drop.

NVIDIA Corporation (NASDAQ:NVDA) shares took a 3.2% hit amidst a fresh wave of selling and the expiration of an enormous amount of Wall Street options bets worth $US5.5 trillion (A$8.2 trillion).

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Despite delayed expectations of US rate cuts due to persistent inflation, the S&P 500 has seen a 14% increase this year, predominantly driven by a select group of mega-cap stocks associated with the artificial intelligence surge.

Back in Australia, the monthly consumer price index, set to be released on Wednesday, is expected to reveal a quickening in the annual inflation rate. Predictions indicate a rise to 3.8% in May, up from 3.6% in April

On the bond markets, Australia 10-Year rates were at 4.249% while 2-Year rates were at 4.056%.

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