* NZ shares at record high
* Inflation figure boosts Aussie benchmark
* Aussie dollar drops 0.9 pct in the wake of CPI data (Updates milestones, price action, recasts, adds inflation data)
By Mensholong Lepcha
April 24 (Reuters) - Australian shares rose to a more than 11-year peak on Wednesday after data showed inflation slowed sharply last quarter, boosting expectations of a rate cut this year.
The S&P/ASX 200 index .AXJO gained as much as 1.1 percent to 6,390.50 by 0250 GMT, with volumes expected to remain comparatively lower throughout the session ahead of a public holiday on Thursday. The benchmark added 1 percent on Tuesday.
The headline consumer price index (CPI) was flat in the March quarter, below forecasts for a 0.2 percent increase and the lowest since a negative reading in early 2016. muted figure comes after the Reserve Bank of Australia (RBA) said earlier this month that if inflation failed to accelerate as desired and unemployment were to suddenly trend higher, then rates would need to be cut from an already record low of 1.5 percent.
"Australian inflation shows no signs of coming anywhere near the central point of the RBA's 2-3 percent range, and we are biting the bullet and changing our 'on-hold' call for the RBA to a cut, possibly as early as the 7 May meeting," said ING Economics in a research note.
"...we can't now see how the RBA can ignore such a bad inflation miss, even with last week's strong employment gains."
While stocks cheered the data, it pushed the Australian dollar AUD=D4 0.9 percent weaker against the greenback.
The currency has been in a downward trend since late March after the country's central bank abandoned its long-standing neutral bias to say its next move in interest rates was likely down. stocks, such as index-heavyweight drug manufacturer CSL Ltd CSL.AX climbed more than 3 percent to its biggest one-day gain since late December.
Financials .AXFJ gained with the Big Four banks, ranging from top lender Commonwealth Bank of Australia to No. 4 lender National Australia Bank NAB.AX , up more than 1 percent each.
The Big Four banks are due to announce earnings next week.
Technology stocks .AXIJ rose as much as 2.6 percent, in line with Wall Street gains overnight, to hit an all-time high.
Better-than-expected earnings saw the S&P 500 index .SPX and the Nasdaq register record closing highs on Tuesday. .N
Computershare Ltd CPU.AX and Afterpay Touch Group APT.AX gained as much as 2.2 percent and 4 percent, respectively.
New Zealand's benchmark S&P/NZX 50 index .NZ50 was trading at its highest level on record, up 0.7 percent at 10,070.10.
Heavyweight a2 Milk Company ATM.NZ rose 1.9 percent, while flag carrier Air New Zealand AIR.NZ was up 1.5 percent.
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