The Australian dollar rose almost two thirds of a US cent following stronger than expected inflation figures.

At 1130 AEDT, the Australian Bureau of Statistics announced that Australia’s headline consumer price index (CPI) rose 0.8 per cent in the December quarter, for an annual rate of 2.7 per cent.

The median market forecast was for headline CPI was expected to rise by 0.5 per cent in the December quarter for an annual rate of 2.5 per cent, according to an AAP survey of 14 economists.

At 1135 the Australian dollar was 88.53 US cents, compared to 87.90 US cents before the data was released.