Bloomberg reports that New Zealand inflation surged in the second quarter, breaching the central bank’s target range for the first time in 10 years and fueling bets it will start raising interest rates as soon as next month.

The annual inflation rate jumped to 3.3%, more than double its first-quarter reading of 1.5% and the fastest pace since 2011, Statistics New Zealand said. Economists expected 2.7%.

New Zealand’s economy is running hot and stoking inflation, as strong demand allows companies to pass on higher costs and a labor shortage threatens to drive up wages. The Reserve Bank, which seeks to keep inflation around the midpoint of a 1-3% target band, this week unexpectedly announced an end to quantitative easing bond purchases, a likely pre-cursor to rate rises.

Westpac New Zealand economists are now predicting quarter-point hikes in August, October and November.

Consumer prices fell in the second quarter of 2020, accentuating their annual increase this year, and some price pressures stemming from pandemic-disrupted supply chains are expected to be transitory. Still, with strong consumer demand giving firms scope to raise prices, faster inflation could become entrenched.