CANBERRA, AUSTRALIA (AP) – Australian inflation rose farther, according to new data released yesterday that increases the likelihood of the central bank next week hiking interest rates for a fourth consecutive month.
Inflation in the year through June was 6.1 per cent, up from 5.1 per cent in the year through March, the Australian Bureau of Statistics said. Inflation only rose by 3.5 per cent during the last calendar year.
Economist Angela Jackson, from the consultancy Impact Economics and Policy, predicted the Reserve Bank of Australia will lift the cash rate by half a percentage point to 1.85 per cent at its next monthly board meeting on August 2.
The bank made rises of that size in its July and June meetings.
The rate rose by a quarter of a percentage point in May, the first rate hike in more than 11 years.
“In terms of the headline figure at 6.1, it is still very high… and it means interest rates will probably go up again next month,” Jackson told Australian Broadcasting Corp.
Treasurer Jim Chalmers warned that inflation would rise further.
“We are not surprised to see inflation north of six per cent, but it’s still confronting,” Chalmers said.
“Inflation is high and rising. It will get tougher before it starts to ease.”
The centre-left Labor Party government was elected in May and Parliament resumed on Tuesday for the first time under the new administration.
Chalmers intends to outline to Parliament Australia’s deteriorating economic outlook since the previous government announced its economic plan in March.
In March, Australia’s gross debt as a share of the economy was forecast to peak in mid-2025 at 44.9 per cent, or AUD1.117 trillion.
Net debt – gross debt less the value of selected financial assets – was predicted to peak at 33.1 per cent of gross domestic product (GDP), or AUD864.7 billion a year later.
