Sydney, July 25, 2007 (ABN Newswire) - Australian shares fell this morning after fresh worries about the U.S. housing market sent U.S. shares tumbling, with top miner BHP Billiton leading the way down. Higher-than-expected CPI data also added to market woes.
At Midday the ASX200 index has dropped 85 points to 6,338 and on the futures market the SPI 200's down 89.
In economic news, the government's index of skilled job vacancies for July fell 0.1 per cent from the previous month, ending 5.7 per cent lower than a year ago. But all eyes were on the CPI data. Underlying inflation in Australia rose by more than anyone expected last quarter, greatly increasing the risk of a hike in interest rates as early as August. The RBA measures of core inflation jumped 0.9 percent, topping all forecasts. The government's measure of the consumer price index rose 1.2 per cent in the quarter, to a rise of 2.1 per cent on the year driven by increases in petrol, food, rents and heath care costs. The Aussie dollar immediately jumped in response
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