Australian borrowers hit again as RBA raises interest rates by 25 basis points to 2.85%

The Reserve Bank of Australia headquarters in Sydney. The RBA has raised interest rates for a seventh month in a row with the official cash rate moving to 2.85%. Photograph: Dean Lewins/AAP

Borrowers have been slugged with a record seventh rate rise from the Reserve Bank of Australia in as many months, as the central bank tries to quell the nation’s strongest burst of inflation in 32 years.

The RBA on Tuesday lifted the cash rate by 25 basis points to 2.85%, the highest since early May 2013. The increase was in line with most economists’ expectations.