Australia's share market has surged to its highest value in almost four months, as investors dismissed an August interest rate rise after inflation undercut forecasts. The top-200 hit its highest value in 21 weeks after headline inflation slowed to 3.8 per cent in the year to June, while a steady, lower-than-expected core inflation reading of 3.6 per cent was enough for traders to write off an August interest rate hike. "The softer (inflation) print firms our view that the cash rate will remain on hold at 4.35 per cent through 2026 and into 2027," said Ebury economist Anthony Malouf. In company news, Perpetual shares fell two per cent after the investment group knocked back an improved offer from Swedish private equity firm EQT. The Australian dollar is buying 69.53 US cents, down from 69.71 US cents on Tuesday at 5pm AEST, as the local interest rate outlook continued to soften.