New Zealand's Annual Inflation Lower at 6 Percent
The lower inflation came as government actions to help rein in cost-of-living pressures and support New Zealanders are starting to work, said Finance Minister Grant Robertson.
The 6-percent increase follows a 6.7-percent increase in the 12 months to March 2023, Stats NZ said.
"Prices are still increasing at rates not seen since the 1990s but are rising at a lower rate than the last few quarters," Stats NZ's consumers prices senior manager Nicola Growden said.
Food was the largest contributor to the June 2023 annual inflation rate. This was due to rising prices for vegetables, ready-to-eat food, and milk, cheese, and eggs, Growden said.
Vegetable prices increased 23.3 percent in the 12 months to June 2023, while ready-to-eat food and milk, cheese, and eggs increased 9.8 percent and 13.8 percent, respectively, he said.
"With food prices up 12.3 percent annually, consumers may be buying cheaper alternatives to keep their food bill lower," Growden said.
The next largest contributor to the annual increase was housing and household utilities. The increase was due to rising prices for both construction and rents, he said.
"The price of building a new home has increased by more than a third in the three years from the June 2020 quarter," Growden said, adding rents increased 4.2 percent in the 12 months to June 2023, following an increase of 4.3 percent in the 12 months to March 2023.
"Inflation is still too high, and we are committed to helping bring down the cost of living and supporting those doing it tough," Robertson said, adding New Zealand's annual rate of 6 percent is below the Organization for Economic Cooperation and Development (OECD) average of 6.5 percent.
New Zealand's Reserve Bank announced last week to leave the official cash rate (OCR) unchanged at 5.5 percent, saying the level of interest rates is constraining spending and inflation pressure as anticipated and required.
The Reserve Bank said the OCR will need to remain at a restrictive level for the foreseeable future, to ensure that consumer price inflation returns to the 1 percent to 3 percent annual target range, while supporting maximum sustainable employment.
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