The announcement comes as Reserve Bank governor Philip Lowe addressed Senate estimates this morning, cautioning that higher wage rises coupled with weak productivity growth threatened to entrench high inflation.

“The message today is loud and clear – to prevent inflationary pressures from remaining higher for longer, moderation of prices and wages over the period ahead is crucial,” ACCI chief executive Andrew McKellar said.

“The uptick in the annual CPI rate to 6.8 per cent, defying consensus forecasts, shows that inflation is stickier than previously anticipated.

“Despite falling inflation since the start of the year and a slight easing in the underlying inflation rate, it’s too early to declare victory in the battle against damaging price increases.”

To keep a lid on the serious threat that inflation poses, Mr McKellar warned that continued wage moderation was imperative in the Fair Work Commission’s upcoming annual wage determination.

“An inflation-linked wage rise for those on award wages would be unsustainable without a corresponding offset via productivity increases. This will make it far more difficult to return inflation to target.

“We cannot afford a situation where unit labour costs continue to rise, while there’s no growth in labour productivity.

“With the Reserve Bank meeting again next week, the ability for small businesses and households to stomach further rate rises is limited after 11 increases to the cash rate since last May.”