The Reserve Bank has lifted the official cash rate by 50 basis points to 1.5 per cent this afternoon. 

Economists had been divided on whether the Reserve Bank would - or should - lift the official cash rate by 0.25 or 0.50 basis points. 

The monetary policy committee said it "remained comfortable" with the outlook for the OCR as outlined in their February Monetary Policy Statement." 

They agreed that moving the OCR to a more neutral stance sooner will reduce the risks of rising inflation expectations. 

"A larger move now also provides more policy flexibility ahead in light of the highly uncertain global economic environment," the committee said in its statement. 

It noted that the Russian invasion of Ukraine has significantly added to "supply disruptions, causing prices to spike in internationally traded commodities and energy". 

The New Zealand dollar rose on the news to trade close to US69c. It had been trading at US68.62c before the announcement. 

ANZ chief economist Sharon Zollner called the 50 basis point hike in her forecast last week. 

"The RBNZ has a big job to do to rein in runaway inflation, and the sooner they rip into it, the lower the economic cost is likely to be," Zollner said.