The Reserve Bank of New Zealand has announced it will be raising the Official Cash Rate (OCR) by 50 basis points to 4.75 percent.
The decision was made by the Monetary Policy Committee, which deemed it necessary to increase the OCR to ensure inflation returns to its target range.
Despite the recent challenges presented by Cyclone Gabrielle and its impact on the economy, the Reserve Bank still believes the OCR needs to be raised.
While demand has started to ease, it continues to outpace supply and it is still too early to assess the full implications of the weather event.
The Reserve Bank's decision has sparked criticism from some politicians, including National's Finance spokesperson Nicola Willis, who took to Twitter to voice her concern.
According to Willis, the rate rise is another "kick in the guts" for New Zealanders who are already struggling with a prolonged cost of living crisis.
She pointed out that this is the 10th rate rise in 18 months and many mortgage holders will be left scrambling.
Willis suggested National would reduce taxes and address inflation to help alleviate the pressure on Kiwis
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