New Zealand's central bank has lifted the official interest rate by a quarter percentage point from a record low of 2.5 per cent, the first change since April last year.
Reserve Bank of New Zealand Governor Alan Bollard said the official cash rate was being raised to 2.75 per cent because the economy was entering its second year of recovery and inflationary pressures were expected to be contained.
"Given this outlook and as previously signalled, we have decided to begin removing some of the monetary policy stimulus that is currently in place," Bollard said.
"The further removal of stimulus will be reviewed in light of economic and financial market developments."
New Zealand slumped into recession at the start of 2008, emerging only in the second quarter of last year with economic growth picking up to 0.8 per cent in the three months to December compared with the previous quarter.
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