Mortgage holders should brace for short-term pain as RBA signals steady interest rate rises to tackle inflation

Philip Lowe says reserve bank looking for its neutral rate' which could see cash rate almost double in coming months

• Follow our Australia news live blog for the latest updates
• Get our free news app, morning email briefing and daily news podcast

Mortgage holders should brace themselves for interest rate rises of at least another 1.15 percentage points before the end of the year as the Reserve Bank of Australia attempts to hose down inflation before it takes hold of the economy.

The RBA governor, Philip Lowe, said he believed inflation was on track to hit 7% by the end of 2022, with an unemployment rate of 3.5% but said the bank was confident inflation would return to the target range" of between 2% and 3% in a short while".