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AAP
AAP
Business
Jacob Shteyman

Row over government role fuelling inflation, rate rise

Money markets are pricing in a three-in-four chance of an interest rate increase. (Bianca De Marchi/AAP PHOTOS)

Poor productivity growth and persistently strong government spending will give the Reserve Bank no choice but to hike interest rates next week, economists say.

Treasurer Jim Chalmers emphatically denied the government was contributing to a resurgence in inflation, after the Reserve Bank's preferred quarterly trimmed mean measure came in above its forecast on Wednesday.

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