Live: Taylor defends Coalition opposition to Labor spending cuts after rate rise

Workplace Relations Minister Amanda Rishworth has been the first cabinet minister up this morning to be grilled about interest rates.

The Reserve Bank hiked interest rates for the fifth time this year to 4.85 per cent. It's the highest cash rate since late 2008.

The central bank's governor Michele Bullock balmed high public and private demand across the country for the rate rise.

Speaking to Channel Nine, Rishworth says the government's budget is not the primary driver of yesterday's Reserve Bank interest rate rise.

But she says that won't stop the government form trying to make savings.

"Budgets are not the primary driver here. We of course as a government take responsibility to make sure that ... we are having responsible savings and targeted cost of living relief," Rishworth says.

Opposition Leader Angus Taylor has defended the Coalition's opposition to government savings measures following yesterday's interest rate hike.

The Reserve Bank hiked interest rates for the fifth time this year to 4.85 per cent. It's the highest cash rate since late 2008.

Yesterday, Reserve Bank Governor Michele Bullock said overall demand public and private demand remained too high across the economy.

Speaking to ABC News Breakfast, Taylor says federal government spending is too high and needs to be cut back to reduce demand.

"One of the things driving demand is going much faster than the overall economy is government spending," Taylor says.

"We've also got an economy that's sclerotic. It's not growing. Enterprise is is giving up the ghost. Small businesses are really struggling."

Asked if the Coalition has any credibility calling for spending cuts when it has opposed savings measures such as the over 65 private health insurance rebate, Taylor says it's overall spending that matters.

"It's aggregate spending that matters ... the overall spending that drives inflation and look, we know this. The IMF is saying that spending is too high."

Hello and welcome to our federal politics live blog. It's great to have you join us here early this Wednesday morning.

I'm Josh Boscaini joining you live from Parliament House in Canberra, here and ready to bring you all of today's federal politics news.

We're expecting to here reaction to the Reserve Bank's decision to hike interest rates to 4.85 per cent — the highest cash rate since late 2008.

The prime minister will be stepping up to speak soon. We'll bring you his press conference here live.

Without further ado, let's get right into the day and see what happens!