Data released last week revealed that inflation has soared to a ten-year annual high of 3.3%, with cost increases across housing, transport, food and construction.
With unemployment low and the economy running hot, economists at Kiwibank believe the Reserve Bank's Monetary Policy Committee and governor Adrian Orr (pictured) should take action.
"The next move is almost certainly a rate hike," the team said. "The 'least regrets' stance is firmly favoured. We now expect the RBNZ to lift the cash rate in August (a little over four weeks from now), in what will be the first of at least three hikes from here.
"We’re likely to see two hikes by year end, and a push to 1% by February."
While the analysts believe the RBNZ will raise the OCR by 75 basis points by February, further hikes will depend on the "sensitivity of the economy coming off record low rates", the team said.
"We have pencilled in another lift in the cash rate to 1.5%, but that’s likely to be all we see in the near-to-medium term. An earlier lift off from the RBNZ will (hopefully) mean less work will need to be done to restrain the economy in the future."
ASB's team has also pencilled in successive rate hikes in August and November, but says the central bank will stick to a "gradual pace", given the "lingering uncertainty" of Covid.
Like Kiwibank, ASB analysts predict a "relatively low" OCR endpoint of 1.5% in the coming cycle.
BNZ's team have also weighed in on the pace of rate increases to be expected over the next year.
The bank's team, including head of research Stephen Toplis, say there is "an increasingly viable" argument for a 1% OCR by November, with hikes in August, October and November.
The team suggested that the central bank could spring a surprise with a 50 basis point increase in the coming months.