Experts say the new raise in the official cash rate will sting for struggling businesses, first-home buyers, and the recently indebted.
The Reserve Bank announced a quarter percentage point rise in the official cash rate to 1 percent yesterday.
Governor Adrian Orr says it was a finely balanced decision and a bigger rate rise was on the cards to try to rein in rampant inflation.
Some economists say the hawkish statement and the RBNZ's signalled path for the cash rate to rise more than 3 percent by 2025 has set the scene for bigger increases this year.
Adrian Orr told says the central bank will be walking a fine line.
