Fears of another interest rate rise have emerged after Reserve Bank governor Michele Bullock warned the central bank is prepared to raise rates again if needed, as Australia’s inflation remains stubborn. Ms Bullock’s warning comes ahead of key inflation data due to be released on Wednesday, with economists expecting underlying inflation to remain above the Reserve Bank’s target range. “Five Budgets, no reduction in spending, a trillion dollars’ worth of debt, and inflation, which hurts the poorest the most, is above the band that the Reserve Bank governor needs to see.” Ms McKenzie argued the Government had failed to present a credible economic plan, leaving the Reserve Bank to rely on higher interest rates to cool inflation. “That’s leaving it to the Reserve Bank to use a very blunt instrument for an interest rate rise while Australians’ living standards are literally seeing the biggest drop in the developed world,” she said.