The rise had been expected and it is the first time since early 2000 that the central bank has raised by such an amount.
The Monetary Policy Committee said the RBNZ needed to move more quickly to get inflation - which is at a 30-year high - back to its 2 percent target.
"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," it said in a statement.
Economists described the decision as a toss of the coin between 25 and 50 basis points, as the central bank confronts inflation expected to go past 7 percent next week, a strong labour market with record low unemployment, a slowing housing market, and prices and supply chains disrupted by there Covid-19 variant, Omicron, and the Ukraine war.
"The level of global economic activity continues to generate rising inflation pressures, exacerbated by ongoing supply disruptions in large part driven by Covid.
"The Russian invasion of Ukraine has significantly added to these supply disruptions, causing prices to spike in internationally traded commodities and energy."
The Committee said the economy had underlying strength, sound finances, and strong export earnings, but inflation and uncertainty were denting consumer confidence.
"The Committee will remain focused on ensuring that current high consumer price inflation does not become embedded into longer-term inflation expectations."
The RBNZ started raising the official cash rate in October last year, with further hikes in November and February this year as it ended its easy money policies which pumped billions of dollars at rock bottom rates to support the financial system when Covid hit in 2020.
The bank's forward projections in February pointed to steady rate rises this year through to 2 percent, with further increases next year.
