Federal Treasurer Jim Chalmers acknowledged Tuesday’s interest rate rise would have been a “difficult day” for homeowners and forecast more short-term pain for families struggling with soaring cost-of-living expenses.

“They expected an interest rate rise but that doesn’t make it any less difficult to find room in the household budget, which is already getting smashed by other skyrocketing cost of living. like energy prices and grocery prices and the like,” Chalmers told Gareth Parker on 6PR Breakfast.

“A number of issues in our economy that the RBA Governor was talking about yesterday are really serious.

“We’ve got high and rising inflation leading to these higher interest rates, we’ve got falling real wages, and our ability to respond to some of these challenges is constrained by the fact we’ve got a trillion dollars of debt in the budget.”

Press PLAY below to hear more from Jim Chalmers about cost-of-living factors