Jim Chalmers makes blunt admission about inflation - as fears mount over another interest rate rise

Jim Chalmers confident inflation will be tamedHe admitted it won't be a straightforward process 

Jim Chalmers says he expects inflation will be tamed, but admitted it will not be a straightforward process after the May figure hit four per cent.

The Treasurer on Sunday was spruiking the stage 3 tax cuts and other federal government measures to come into effect from this Monday.

But the fears of the official interest rate - currently at 4.35 per cent - could be increased for a 14th time this cycle was overshadowing the message.

Dr Chalmers acknowledged many households are 'under the pump' because of higher cost of living pressures and interest rates, but he said he expected the government's policies to be 'helpful in the fight against inflation'.

'We're confident but not complacent we can get on top of this inflation challenge,' Dr Chalmers said.

'We can provide this cost of living relief, and we can get the budget in better nick without smashing the economy.'

Speculation of another interest rate increase went into overdrive on Wednesday after hotter-than-expected inflation data, which came in at 4 per cent in the 12 months to May, spurred investors to increase bets of another hike as soon as the RBA's next meeting, scheduled for August 6.

'I think it's really clear that the interest rate rises, which are already in the system, are already putting a lot of pressure on people,' Dr Chalmers said.

Federal Treasurer Jim Chalmers says he expects inflation will be tamed get, despite the May figure hitting 4 per cent and raising fears the Reserve Bank could be forced to hike the cash rate again

'We've seen that in a whole bunch of economic indicators. I understand that, and that's another reason why this help tomorrow is so important.'

But he warned Australians should not expect the easing of inflation to be straightforward.

'This inflation in our economy will continue to ease. It doesn't always ease in a perfectly straight line,' Dr Chalmers said.

'We've seen that around the world as well. And we're seeing that here in Australia too.

'But our role is to try and make life a little bit easier for people.

'That's why the tax cuts, the energy bill relief, the pay rises, the cheaper medicines, the paid parental leave, that's what it's all designed to do.'

The Treasurer on Sunday was spruiking the stage 3 tax cuts and other federal government measures to come into effect from this Monday (stock image)