SYDNEY: Australia ramped up its military response to deadly floodwaters rising in the country's sodden northeast Tuesday which have killed four people and displaced or isolated tens of thousands.

Storms triggered by ex-tropical cyclone Oswald have claimed four lives, the most recent a three-year-old boy killed by a falling tree, as heavy rains have brought flooding to the states of Queensland and New South Wales.

The sugar farming town of Bundaberg waited anxiously for the swollen Burnett River to peak at a record 9.6 metres , with officials saying some 2,000 homes and 300 businesses were flooded.

Queensland Police Minister Jack Dempsey said about 7,500 residents had been displaced by the floodwaters, with 1,000 people plucked from the roofs of their homes in daring evening rescues after the river broke its banks late on Monday.

Queensland Premier Campbell Newman toured Bundaberg from the air and said it was an “extraordinary” scene, paying tribute to military rescue teams who toiled until midnight using night vision equipment.

“I think the bravery of the air crew and the helicopters, both civilian and defence force who worked all yesterday afternoon and into the night evacuating people in quite difficult circumstances is what saved the day,” said Newman.

“We did have a situation of fast-rising floodwaters and people being very rapidly isolated on ever-diminishing islands of ground.” Prime Minister Julia Gillard said four military helicopters, 100 troops and two Hercules transport aircraft had been deployed to the emergency, with the evacuation of 131 patients from Bundaberg's hospital to Brisbane a priority.

“We'll also be making available one of the huge aircraft, the C17, to transport equipment that is needed to Bundaberg for the Queensland Fire and Rescue Service and for the Queensland Ambulance Service,” Gillard said.

There was limited flooding in the state capital Brisbane, home to about two million people, which was brought to a standstill for several days by a huge inundation in 2011 that swamped 30,000 homes and killed more than 30 people.

Brisbane mayor Graham Quirk said some city businesses had been swamped for a second time but there were no reports of homes flooding inside, with the Brisbane River peaking lower than had been forecast.

But the deluge damaged water treatment plants and Newman warned that some of the city's reservoirs could dry up overnight if people didn't restrict their use to drinking, cooking and washing.

Several major mining firms including Xstrata, Anglo American and China's Yancoal said the weather had impacted operations, either halting work at their pits or cutting vital road and rail links.

Insurers had already received some 6,100 claims from Queensland worth Aus$72 million , according to the Insurance Council of Australia.

Cyclone Oswald brought wild storms to neighbouring New South Wales overnight, with floodwaters isolating 41,000 people and prompting authorities to order 2,100 people to evacuate from the town of Grafton.

“On Thursday and Friday we were nearly in drought conditions. Here we are on Tuesday morning talking about the biggest flood on the history books,” mayor Richie Williamson told reporters at a briefing in Grafton.

Wild weather ripped trees up and brought dangerous surf conditions in Sydney, with waves of up to 10 metres reported.