Inflation has climbed to three per cent, at the top of the Reserve Bank's target range, as higher fuel and building costs stalled Australia's progress on limiting price rises.

Economists had expected the headline consumer price index, which was released by the Australian Bureau of Statistics on Wednesday, would rise from 2.8 per cent to 2.9 per cent for the month of August.

"The three per cent annual CPI inflation to August was up from 2.8 per cent to July, making this the highest annual inflation rate since July 2024," said ABS head of prices statistics Michelle Marquardt.

The rise in the CPI was driven by food, housing and alcohol and tobacco.

Electricity costs rose 24.6 per cent in the 12 months to August.

Ms Marquardt said that was a result of higher out-of-pocket costs for consum

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