The Reserve Bank governor says mortgage holders and renters are hurting immensely from the rising cost of living and higher interest rates.

Speaking at a parliamentary committee hearing in Canberra, Philip Lowe said people were writing to him about their personal circumstances.

“I read those letters and hear those stories with a very heavy heart,” he said.

“Personally … I find it disturbing.”

But he said higher interest rates were necessary to rein in inflation.

“If we don’t get on top of inflation it means even higher interest rates and more unemployment,” he said.

Dr Lowe also commented on the profits Australia’s big banks were making during the policy tightening period.

“I know it’s hard for people to accept when they’re suffering with problems with their personal finances, but the country is better off having strong, resilient banks that can provide the financial services that we need,” he said.

Responding to criticism of a private briefing he gave a group of bankers on interest rate hikes, Dr Lowe said he was revising his timetable of public speaking arrangements based on feedback that he was “maybe talking too much”.

“And it is possible to talk too much. I have been conscious of that,” he said.

The central bank has faced criticism about its interest rate predictions and how these forecasts have been communicated.

Bernie Fraser, who led the RBA for seven years before his tenure ended in 1996, said it would be better if the central bank flagged the possibility of further rises while it watched the impact of existing interest rate hikes, rather than giving firm predictions.

“The market has sort of jumped on and interpreted this as the likelihood or near-certainty of another three or four increases to interest rates,” he told ABC Radio on Wednesday.

“And that’s unhelpful and doesn’t provide the kind of confidence that the bank should be striving to enlist with the community.”

Dr Lowe also denied the independence of the institution was under attack from government ministers.

“It’s not affecting our decision-making, let me assure you that,” he said.

“The decisions are based on the data of the analysis, and the facts.”

He said there was no pressure from the treasurer or other ministers to stop increasing the cash rate.

“It’s noisy but raising interest rates is always unpopular and it affects the whole community and the representatives of the community understandably will sometimes want to talk about that,” he said.

“But we keep doing our job and our job is to make sure inflation comes down and hopefully preserve the gains in unemployment that we have made.”

Treasury secretary Steven Kennedy, who has a seat on the RBA board, said criticisms of interest rate decisions should be applied to all board members.

“The criticisms or otherwise of the interest rate decisions apply to the whole board, not just the governor because it’s the board that makes the decisions,” he told a parliamentary committee on Wednesday.

– AAP