Prices rose 1.8 per cent over the June quarter as higher petrol and grocery bills continue to squeeze households, new official data reveals.

Australian Bureau of Statistics (ABS) figures published on Wednesday showed inflation is now running at the fastest rate since June 2001.

Prices are now up 6.1 per cent in the past year, up from 5.1 per cent.

ABS head of price statistics Michelle Marquardt said fuel prices and the cost of building houses were the largest inflation drivers for the quarter.

“The CPI’s automotive fuel series reached a record level for the fourth consecutive quarter,” she said in a statement.

“Fuel prices rose strongly over May and June, following a fall in April due to the fuel excise cut.”

Wednesday’s data showed the pace of price hikes across the economy is gathering pace ahead of an expected peak of 7 per cent in late 2022.

The Australian Chamber of Commerce and Industry said the price hikes are “alarming inflation figures”.

The surge foreshadows more interest rate hikes from the Reserve Bank, which is pushing up mortgage bills in a bid to curb rising prices by lowering household spending.

The RBA has already lifted the cash rate target from 0.1 per cent to 1.35 per cent since May, and ANZ Bank predicts it could reach 3.35 per cent by November.

More to come …

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