ASX 200 dives 1.6pc; worst day in three months as 'hot' inflation sparks fear

Bourse sees biggest one-day fall in three months. Goldman Sachs back June, July rate hikes. Dollar drops to October 2022 low. Weak Chinese data hits iron ore.  BoQ dives on Austrac action.

Equity investors are on a rollercoaster ahead of a key vote on the US debt deal, other global and local developments. Picture: Gaye Gerard

Welcome to the Trading Day blog for Wednesday, May 31. The Australian sharemarket recorded its biggest one-day drop in three months as investors digested April inflation numbers and updates from China.

The S&P/ASX 200 index lost 118 points, or 1.6 per cent to close at 7091.30.

Wall Street is set to drop at the open with futures tied to the S&P 500 and Nasdaq off 0.4 per cent, while the Dow Jones was down 0.5 per cent. 

The dollar was buying around US64.90c at the close - its lowest since October 2022.