New Zealand hikes rates by 50 bps, biggest in over 20 yrs, as inflation risks grow

NEW Zealand's central bank raised interest rates by a hefty 50 basis points on Wednesday, the biggest hike in over two decades, extending a global shift towards tighter policy as authorities seek to reduce second-round effects from runaway inflation.

The Reserve Bank of New Zealand (RBNZ) raised the official cash rate to 1.50%, a level not seen since June 2019, saying the larger move was intended to take the cash rate to a more neutral stance and prevent high inflation becoming entrenched.