Breaking: Inflation surges more than expected ahead of RBA meeting

Australia's inflation rate unexpectedly accelerated in September, signaling a potential interest rate increase next week, according to the Australian Bureau of Statistics (ABS). The consumer price index jumped to 0.8 percent, up from 0.4 percent in August, pushing annual inflation to 4.3 percent from 4 percent the previous month.

Housing prices were the main driver, surging by 5.2 percent, while transport costs, mainly due to rising fuel prices, added another 9.4 percent. The annual trimmed mean, which gauges underlying inflation, also climbed to 3.6 percent in September, a revision from 3.5 percent in August. Despite the fuel price volatility, inflation worries are mounting, with market forecasts for a November rate hike at around 85 percent, as per Bloomberg data.

KPMG Australia's chief economist, Brendan Rynne, termed the inflation figures as the final piece the Reserve Bank of Australia (RBA) needs to hike the cash rate for the fifth time in 2024. The RBA's inflation target sits between 2-3 percent, and recent data suggests inflation pressures are intensifying, surpassing market expectations.

The RBA's interest rate-setting board is set to convene on Monday, with a decision expected on Tuesday afternoon, along with an update to its economic forecasts, including inflation predictions.