The Australian equity benchmark fell slightly on Wednesday, as the heavily weighted banking and resource-linked stocks dragged, while Iran war-related inflationary pressures persisted.

The S&P/ASX 200 index fell 0.6% to 8,554.20 by 0028 GMT.

The benchmark closed up 1.2% on Tuesday.

The main index rebounded from its lowest in nearly seven weeks in the previous session, after the Reserve Bank of Australia indicated a wait-and-watch monetary policy path following three interest hikes this year.

RBA’s May board meeting minutes flagged that the central bank regards current monetary policy as adequately restrictive, giving it room to observe the impacts of the war on inflation and growth.

The central bank is, however, worried that higher energy costs will feed through to consumer prices quickly, given the stretched state of the domestic economy, potentially creating a significant shift in inflation expectations.

Financials lost 0.6%, led by a 0.6% decline in top lender Commonwealth Bank of Australia.

Mining stocks fell for the fifth session in a row, with iron ore and copper prices hitting multi-week lows.

BHP , Rio Tinto and Fortescue shed about 1%-2%. Among gold miners, index leaders Northern Star Resources and Evolution Mining fell 1.5% and 2.6%, respectively.

The industrials sub-index declined 0.2%, with James Hardie’s falling as much as 5.1% after the fibre cement maker forecast annual earnings below market expectations.

Energy stocks defied weakness in crude prices to advance for the fourth straight session, with sector majors Woodside Energy and Santos rising 0.7% and 1%, respectively.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index fell 1.1% to 12,834.02.

The island nation’s finance minister said the government plans to cut thousands of public service jobs and avoid pre-election giveaways in the budget next week.