New Zealand retail sales has risen four times more than analysts have estimated in the second quarter, which would give more room for central bank Governor Alan Bollard to keep raising interest rates.

Statistics New Zealand said in Wellington today said sales, adjusted for inflation, moved upwards 1.3 percent from the first quarter, when they rose 0.2 percent.

Core sales, which exclude vehicle dealers, fuel outlets and workshops, rose 0.9 percent from the first quarter when they declined 0.5 percent, today's report showed.

New Zealand's dollar rose to 71.31 U.S. cents at 11:11 a.m. in Wellington from 70.85 cents just before the report.

Increased consumer spending has so far did not fill up the gap of falling house sales and rising unemployment.

Central Bank head Bollard raised the official cash rate to 3 percent on July 29. He is expected to moderately increase rates as the country's economic outlook "softened."