WELLINGTON: The Reserve Bank of New Zealand (RBNZ) raised interest rates by a hefty 50 basis points to 1.50% on Wednesday, its fourth hike in a row as it seeks to reduce any second-round effects from sharply rising inflation.

All 21 economists in a Reuters poll had expected the RBNZ to hike rates. Fifteen had forecast a 25 basis point increase while the rest had expected a 50 basis point hike.

Australia, NZ dollars drift off, await RBNZ rate call

“A larger move now also provides more policy flexibility ahead in light of the highly uncertain global economic environment,” the Reserve Bank of New Zealand said in a statement explaining why it increased the official cash rate by 50 basis point, which was its biggest rate increase in more than20 years.