• ASX gains more than 1pc
  • RBA governor Phil Lowe expects inflation to reach 7% by end of year
  • President Biden believes US recession is not inevitable


Local shares gained back 1.3% today, as a rebound in oil and iron ore prices helped lift the bourse.

Energy and Mining closed higher by around 2%, while Financials jumped 2.5% after a speech by the RBA governor, Philip Lowe.

Dr. Lowe told a forum in Sydney that inflation will hit 7% by the end of this year, but doesn’t think that a recession will eventuate in Australia. He did however warn that more rate rises were coming.

“As we chart our way back to 2 to 3% inflation, Australians should be prepared for more interest rate increases,” Lowe said.

“We are now expecting inflation to peak around 7 per cent in the December quarter. Following this, by early next year, we expect that inflation will begin to decline.

“How fast we increase interest rates, and how far we need to go, will be guided by the incoming data and the board’s assessment of the outlook for inflation and the labour market,” he added.

The next RBA interest rates decision will be on July 5th.

Meanwhile, commodity prices bounced back in Asian hours with both oil and iron ore gaining around 1%.

US Treasury Secretary Yellen has been circulating a plan to put a price cap on Russian oil to deprive them of revenues, a move that could further tighten supply.

“The bottom line seems to be that until we see physical demand destruction, oil and other energy markets are as tight as ever,” said Oanda market analyst Jeff Halley.

Deutsche Bank has now joined the chorus of investment banks tipping a US recession in 2023. President Biden however disagrees, saying that a US recession is not inevitable.

“No, I don’t think it is. I was talking to Larry Summers this morning, there’s nothing inevitable about a recession,” Biden said.



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Australian Agricultural (ASX:AAC) closed steady after CEO Hugh Killen resigned from his post effective immediately. It came as Twiggy Forrest’s Tattarang increased its stake in the company from 7.90% to 17.41% last Friday.



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Lithium stock Lake Resources (ASX:LKE) dropped 27% today after announcing after hours last night that current chairman Stu Crow will serve as Executive Chairman for six months to oversee the appointment of a new CEO, board members, and the establishment of US offices. This comes as LKE announced the departure of former managing director Steve Promnitz.