The Reserve Bank of Australia has lifted interest rates for the seventh month in a row.

The board decided to increase the cash rate target by 25 basis points to 2.85 per cent.

RBA governor Phillip Lowe said it’s predicted inflation will hit 8 per cent in the coming months.

“The board has increased interest rates materially since May,” he said in a statement.

“This has been necessary to establish a more sustainable balance of demand and supply in the Australian economy to help return inflation to target.

“The board expects to increase interest rates further over the period ahead.”

Press PLAY below to hear Deborah Knight break the news