Stats NZ numbers showed food prices easing 0.4 percent in November from the month before. Photo: Unsplash / Tara Clark
- Food prices fall for the third consecutive month, but higher than a year ago
- Fruit and vegetables drive food prices lower
- Fuel, accommodation & airfares puts pressure on overall prices, offsetting food price decreases
Food price pressures eased in November amid a sharp fall in the price of fruit and vegetables, but remain considerably higher than a year ago.
Stats NZ numbers showed food prices easing 0.4 percent in November from the month before, the third consecutive monthly fall.
But on an annual basis, food prices were 4.4 percent higher than a year ago, compared to a 4.7 percent increase in the October year.
Fruit and vegetable prices fell 4.5 percent last month owing to seasonal produce like tomatoes and berries, but were 3.7 percent higher than a year ago.
Prices for dairy, red meat, and other staples like bread also remained significantly higher than a year ago.
Stats NZ said a typical two-litre bottle of milk cost $4.91, up nearly 16 percent from a year ago, while porterhouse/sirloin beef stake was up more than a quarter from a year ago to $45.39 per kilogram.
Petrol prices were nearly 3 percent higher than a year ago, and domestic air transport fares rose more than 6 percent monthly, but were more than 14 percent below a year ago.
BNZ head of research Stephen Toplis said the latest price data - which made up close to half of the overall consumer price basket - did not alter its forecast for fourth quarter inflation.
BNZ projected annual inflation to ease from 3 percent to 2.8 percent in the three months ending December.
Toplis said there were "familiar themes" in the latest data.
"Annual energy price inflation remains very high, food price inflation is elevated but easing, rent inflation continues to ease to new multi-year lows," he said.
Rent price increases slowed to be 1.4 percent higher than a year ago.
"We have long thought annual rent inflation would ease and we still think it has further to go," Toplis said.
Westpac senior economist Satish Ranchhod said the November price data was a bit firmer than expected, largely due to the volatile travel categories.
"We expect both tradables and non-tradables inflation will be a bit hotter than the RBNZ expects in the December quarter, with tradable prices accounting for most of that difference," he said.
Westpac expected inflation to ease gradually to be "comfortably" within the RBNZ's 2-3 percent target band by mid-2026.
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