Australian shares closed little changed in range-bound trade on Wednesday, with gains in gold miners countering losses in base metals and energy firms, while New Zealand stocks fell after the central bank delivered a bigger-than-expected rate hike.

The S&P/ASX 200 index finished 0.02%, or 1.2 points, higher at 7,237.20, its highest close since March 9.

The benchmark inched 0.2% higher on Tuesday.

A day after the Reserve Bank of Australia (RBA) left its cash rate unchanged, Governor Philip Lowe said a pause did not imply an end to tightening, which could be needed to contain inflation.

Analysts at National Australia Bank wrote in a note they expect the cash rate to peak at the current rate of 3.6% and that “the RBA to remain on hold until the first half of 2024 before the cash rate is cut back to 3.1%”.

“The RBA is now very data-dependent, and the key risk to our view in the near term is that the RBA reads inflation or wage growth as sufficient to do more before the full impact of rates fully flows through,” they said.

Tony Sycamore, an analyst at IG Australia, said he does not expect the RBA to provide the next catalyst to the stock market in the short term, predicting the central bank would pause for a month or two, or even longer.

Gold stocks advanced 3.8%, with index heavyweight Newcrest Mining up 2.8%, as bullion prices touched their highest levels since March 2022.

Energy stocks fell 0.6%, with heavyweights Santos Ltd and Woodside Energy down 0.6% and 1%, respectively.

Australian shares close at three-week high; central bank move in focus

Heavyweight miners slipped about 0.6%. Iron ore giants BHP Group, Rio Tinto, and Fortescue Metals Group tumbled between 1.4% and 1.7%.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index fell 0.3% to 11,866.83, after the country’s central bank unexpectedly raised its cash rate by 50 basis points to a more than 14-year high of 5.25%.