Australian shares have closed lower after the release of higher than expected inflation figures.
Consumer price index (CPI) growth of 0.8 per cent for the December quarter was above the 0.5 per cent rise expected by economists, reducing the chances of another rate cut by the central bank.
CommSec analyst Tom Piotrowski said the big miners also suffered from a fall in iron ore prices.
"The primary factors weighing on the market are the miners continuing to underperform as the price of iron ore moves back to $US120 per tonne, and a higher than expected reading on December quarter inflation," Mr Piotrowski said.
"We've had an adjustment in interest rate expectations, with rate cuts off the table for the time being, which is weighing on equities."
Shares in the country's largest home lender, Commonwealth Bank, dropped 19 cents to $75.91, but Westpac gained 16 cents to $31.95, ANZ added 25 cents to $31.40 and NAB rose 30 cents to $34.29.
Retailers also fell, with Woolworths down 19 cents to $34.20, Coles owner Wesfarmers off 16 cents to $43.39 and Harvey Norman two cents weaker at $3.23.
In the mining sector, BHP Billiton dropped 32 cents to $37.63 as it reported production falls in its key iron ore and petroleum divisions in the December quarter.
Rival Rio Tinto lost 51 cents to $65.29 and iron ore miner Fortescue Metals was six cents lower at $5.35.
Telstra dropped four cents to $5.22.
- At the close on Wednesday, the benchmark S&P/ASX200 index was down 11.7 points, or 0.22 per cent, at 5,319.8.
- The broader All Ordinaries index was down 10.7 points, or 0.2 per cent, at 5,331.3.
- The March share price index futures contract was nine points lower at 5,279, with 18,093 contracts traded.
- National turnover was 1.67 billion securities worth $3.94 billion.