CANBERRA, AAP – Reserve Bank governor Philip Lowe will face the business community at a time of escalating inflation, rising fuel costs and uncertainty over when official interest rate will start to rise.

Dr Lowe will address the Australian Financial Review business summit on Wednesday.

Following last week’s monthly RBA board meeting, Dr Lowe kept to the script of remaining patient before lifting the cash rate from a record low 0.1 per cent.

Dr Lowe confirmed his commitment to driving the economy to full employment by keeping interest rates low for as long as possible.

The RBA and Treasury expect the unemployment rate will fall below four per cent later this year and stay there, something that hasn’t been achieved in some 50 years. It was 4.2 per cent in January.

Dr Lowe reiterated wages growth remains modest and it is likely to be some time yet before growth in labour costs is at a rate consistent with inflation being sustainably within the two to three per cent target.

But the governor also warned Russia’s invasion of the Ukraine is a major source of uncertainty.

The resulting rise in global crude oil prices to a 14-year high above $US100 per barrel from the conflict will add to already surging inflation around the world, and see local petrol prices set further record highs.

National Australia Bank chief economist Alan Oster has brought forward the timing of when he expects the first increase in the cash rate to August from November, lifting his forecasts for inflation and employment.

He now expects the unemployment rate to be four per cent by March, well ahead of the RBA’s expectations and be around 3.5 per cent in the second half of the year.

Underlying inflation is expected to be 3.75 per cent by mid-year, well beyond the RBA’s two to three per cent target.

Speaking the AFR conference on Tuesday, former treasurer Peter Costello urged the RBA to get on with raising rates.

“Get with the curve rather than be behind the curve,” he said.

ANU professor and former RBA board member Warwick McKibbin told the conference the RBA should consider raising rates soon.

“What’s the best time to raise interest rates? When we have a strong economy,” he said.