Inflation Jumps as Homeowners Face Second Blow from Interest Rate Hike

The Reserve Bank of Australia's decision to raise the cash rate was met with a second blow for homeowners, as inflation jumped to 4% in August, up from 3.5% in July.

The Australian Bureau of Statistics released figures on September 30, showing that housing remained one of the largest drivers of inflation, rising 5.7% in the past 12 months.

Electricity and fuel costs also contributed to the increase, with transport rising 5.6% thanks to higher world oil prices and the unwinding of the federal government's fuel excise relief measures in August.

Reserve Bank governor Michele Bullock acknowledged that the timing of the inflation figures was unfortunate, coming less than a day after the Reserve Bank made its decision to raise the cash rate to 4.6%.