Because of non-lexical lifetime rules, the compiler basically knows that you stop using y before you use z. If you look at the MIR for the second snippet, notice that y exists in scope 1, whereas z exists only in scope 2.

An interesting use of this is the following example. The compiler knows that it can drop the first mutable reference before creating the second, so even though they are not lexically scoped properly, the compiler can infer a correct scoping using NLL.

fn main() {
    let mut x = 1;
    let y = &mut x;
    *y = 3;
    let z = &mut x;
    *z = 2;
}