Australian interest rates in 'tricky territory', ANZ's chief economist Richard Yetsenga says, as future cuts remain uncertain

Australian interest rates continue to be in “tricky territory”, a leading economist has said, as mortgage holders hold out hope for future cuts despite skyrocketing inflation.

The Australian Bureau of Statistics on Wednesday revealed annual inflation lifted to 3.2 per cent in the September quarter - from 2.1 per cent in June.

Trimmed mean inflation – the middle 70 per cent of price changes crucial to the Reserve Bank of Australia’s rates decision – rose to three per cent, coming in at the top of the central bank’s two to three per cent target band.

The shock inflation lift, which exceeded market expectations, has led to a flurry of revised interest rate forecasts.

None of the major banks anticipate rate cuts this year after Commonwealth Bank of Australia and Westpac both updated thei