Inflation is still at stubbornly high levels stirring fears of more interest rate rises.

The consumer price index rose by 5.6 per cent in May, down from an annual pace of 6.8 per cent in April.

Treasurer Jim Chalmers said inflation was moderating after last year hitting levels unseen since 1990.

‘We expect it to stay higher than we’d like, for longer than we’d like, but still tracking in the right direction,’ he told the Property Council of Australia in Darwin on Wednesday.

Inflation is still at stubbornly high levels stirring fears of more interest rate rises (pictured is a Woolworths shopper in Sydney)

The major banks are all expecting the Reserve Bank of Australia to raise interest rates again next week, which would be the 13th increase since May 2022. 

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The 12 increases, so far, in just 13 months have marked the most aggressive pace of monetary policy tightening since 1989, with some economists worried about the increases tipping Australia into a recession.

The RBA isn’t expecting inflation to return to the top of its two to three per cent target until June 2025. 

Food prices are still rising by double-digit figures with bread and cereal prices rising by 12.8 per cent and dairy product costs going up by 15.1 per cent.

But in signs of hope, fruit and vegetable prices rose by just 2.7 per cent over the year. 

The major banks are all expecting the Reserve Bank of Australia to raise interest rates again next week, which would be the 13th increase since May 2022 (pictured is governor Philip Lowe with his deputy and possible successor Michele Bullock)

Source: | This article originally belongs to Dailymail.co.uk