New Zealand's central bank delivered its seventh straight interest rate rise on Wednesday and signalled a more hawkish tightening path over coming months to restrain stubbornly high inflation.

The aggressive tone of the Reserve Bank of New Zealand's (RBNZ) statement warning of future hikes being brough forward lifted the local dollar and pushed swap rates higher.

The RBNZ raised the official cash rate (OCR) by 50 basis points to 3.0%, a level not seen since September 2015, and crucially, it now sees rates at 4.0% by early next year, compared to a previous projection of 3.7%.

The central bank also increased the projected peak for the cash rate to above 4.0% where it expects it to remain into 2024.

"It remains appropriate to continue to tighten monetary conditions at pace to maintain price stability and contribute to maximum sustainable employment," the central bank said in a statement.

All 23 economists polled by Reuters had expected the central bank's policy committee to lift the cash rate by 50 basis points, but there was some division about where rates would peak and if it might need to cut them next year.

"Committee members agreed that monetary conditions needed to continue to tighten until they are confident there is sufficient restraint on spending to bring inflation back within its 1-3% per annum target range," the central bank said.

Inflation has been running at three-decade highs hitting 7.3% in the second quarter even though the RBNZ has been a front-runner among central banks in withdrawing pandemic-era stimulus. The cash rate has risen rapidly from a record low of 0.25% in October.

Markets were quick to price in the more aggressive outlook.

Bank bill futures for March slid 13 ticks to 95.76, while two-year swap rates rose 6 basis points to a three-week top of 3.97%.

The New Zealand dollar rose 0.4% to $0.6360.

In the first quarter, New Zealand's economy unexpectedly contracted due to a surge in COVID-19 cases and growth is expected to be restrained over coming quarters due to tightening financial conditions.

The RBNZ's statement on Wednesday reinforced its priority was on preventing inflation from getting out of hand even at the expense of growth.