The benchmark S&P/ASX200 index on Friday closed down 8.5 points, or 0.1 per cent, at 8,214.5, while the broader All Ordinaries dipped 7.2 points, or 0.08 per cent, to 8,491.5.
For the week, the ASX200 gained 64.5 points, or 0.79 per cent, after dropping 62.2 points the prior week.
Its finish on Friday was 55.3 points, or 0.7 per cent, off its all-time best close of 8,269.8 set on September 30.
This week markets had been helped by the absence so far of Israeli retaliation against Iran that might disrupt oil supplies, as well as hopes for a continuation of "Goldilocks" economic conditions - not too hot and not too cold, AMP chief economist Shane Oliver said.
Markets dipped on Friday after the US Labor Department overnight reported "core" consumer prices, excluding volatile food and energy costs, rose unexpectedly in September.
Weekly US jobless claims also came in at 258,000, compared to consensus expectations of 230,000.
"While it would be a little rogue to start making grand proclamations about an economy exhibiting stagflationary characteristics - clearly that's not true - any time you see signs of softer labour demand but marginally higher price pressures, the markets don't respond favourably," said Capital.com analyst Kyle Rodda.
Five of the ASX's 11 sectors finished lower on Friday and five closed higher, with financials basically flat.
The materials sector was the biggest mover, though that's not saying much. It dropped 0.45 per cent as losses for the iron ore giants outweighed gains for goldminers.
BHP fell 1.1 per cent to $43.43, Fortescue dropped 1.3 per cent to $19.47 and Rio Tinto dipped 0.2 per cent to $119.58.
Northern Star gained 1.1 per cent, Evolution grew 1.8 per cent and Newmont rose 2.1 per cent as the yellow metal changed hands at a two-day high of $US2,644 an ounce.
The big four banks also had a subdued day, with CBA dipping 0.4 per cent to $135.64, Westpac edging 0.1 per cent lower at $30.86, ANZ adding 0.2 per cent to $30.39 and NAB basically flat at $37.28.
In small caps, IRIS metals soared 102.8 per cent to 36.5c after the lithium explorer announced it had successfully converted spodumene concentrate to 99.5 per cent battery-grade lithium at its Beecher Project in the US state of South Dakota.
The Australian dollar was buying 67.41 US cents, from 67.30 US cents at Thursday's ASX close.
Looking forward, on Saturday China's Finance Ministry holds a press briefing where traders hope officials will detail concrete financial support for markets, after China's top planning agency earlier this week held back from announcing major stimulus measures.
This briefing might be disappointing as well, however. China's National People's Congress doesn't meet until late October, and Dr Oliver said it was unclear how much the Finance Ministry could do without that body's approval.
ON THE ASX:
* The benchmark S&P/ASX200 index finished Friday down 8.5 points, or 0.1 per cent, at 8,214.5
* The All Ordinaries dropped 7.2 points, or 0.08 per cent, at 8,491.5
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 67.41 US cents, from 67.30 US cents at Thursday's ASX close
* 100.22 Japanese yen, from 100.37 yen
* 61.64 euro cents, from 61.53 euro cents
* 51.67 British pence, from 51.49 pence
* 110.48 NZ cents, from 110.58 NZ cents
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