Inflation surges more than expected ahead of RBA meeting
Posted , updated
The RBA deputy recently warned the inflation outlook was now "materially worse". (ABC News: Sharon Gordon)
Australia's inflation rate picked up more than expected in September, increasing expectations of an interest rate hike next week.
The consumer price index rose to 0.8 per cent in the month, from 0.4 per cent in August, taking annual inflation to 4.3 per cent, up from 4 per cent a month earlier, the Australian Bureau of Statistics (ABS) said.
"Housing was the largest contributor to annual inflation in September, rising by 5.2 per cent," ABS head of price statistics Rachael McCririck said.
The annual trimmed mean, a measure of underlying inflation, also picked up to 3.6 per cent in September. The August trimmed mean was revised lower to 3.5 per cent.
Last week, Reserve Bank deputy governor Andrew Hauser warned the inflation outlook looked "materially worse" than the RBA had forecast, raising the prospect of another interest rate hike next week.
Market pricing put the chance of a November rate hike at more than 60 per cent ahead of today's inflation data release.
The RBA's interest rate setting board will kick off its meeting on Monday and hand down its decision on Tuesday afternoon.
It will also release its updated economic forecasts, including for inflation.
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