Wellington - New Zealand's inflation rate, boosted by soaring petrol prices, hit an 18-year high of 5.1 per cent in the 12 months ending September 30, official figures revealed Tuesday.

The consumers price index rose 1.5 per cent in the September quarter, Statistics New Zealand said.

The figures came as no surprise to analysts, who said that the inflation rate was likely to have peaked with consumer prices for fuel and food already beginning to ease.

Analysts expect the Reserve Bank to cut up to 100 basis points - or 1 percentage point - off the benchmark interest rate, reducing it to 6.5 per cent, in a scheduled review of monetary policy on Thursday.

Reserve Bank governor Alan Bollard surprised in the last review six weeks ago by cutting 50 basis points off the official cash rate, bringing it down to 7.5 per cent.

Reports say the markets fully expect a record cut of 1 per cent on Thursday, though some economists are not discounting the possibility that Bollard will only reduce the rate by 75 points.

The Bank of New Zealand has forecast that the rate will be down to 5.25 per cent by the middle of next year, the lowest level for four years. (dpa)