Australia has suffered a setback in its fight against inflation after April’s consumer price index data rose more than expected.

The latest CPI reading came in at 3.6 per cent, above the 3.4 per cent forecast by economists. March’s CPI reading was 3.5 per cent. Rising prices for rent, alcohol and transport drove the increase.

The Reserve Bank of Australia has all but ruled out a cut in interest rates this year, with some economists now predicting the central bank may raise rates in the face of stubborn inflation.

The Australian budget, released this month, included relief measures for energy and rent that could potentially add to inflation.