The inflation rate has continued to fall with Stats NZ today announcing an annual Consumer Price Index (CPI) of 5.6% for the September quarter.
The CPI is an annual measure reflecting changes in the price of goods and services.
But despite the annual drop, the quarterly inflation rate was 1.8%, meaning a rise in the past few months, fuelled by a 16.5% increase in petrol.
The quarterly inflation rate for the previous quarter, ended June 2023, was 1.1%.
This quarter's inflation was driven by a 7.1% rise in transport costs, with private transport supplies and services up 11.6%.
Figures today may have showed inflation slowing to 5.6% year-on-year, but when we look at the past three months, it's still up 1.8%. (Source: 1News)
Housing and household utilities rose 1.7%, with increases for property rates and related services (9.4%) and actual rentals for housing (1.2%) key to that increase.
Food rose by 0.9% – but it's markedly less than the 2.2% increase for food in the previous quarter.
It comes after 32-year high CPI of 7.3% back in the June 2022 quarter and a recent cooling off.
Food has been a major driver, with the cost of living in the spotlight at the recent election.
Stats NZ has released its latest measure of inflation. It comes after a 32-year high back in the June 2022 quarter. (Source: 1News)
For the annual change, food remains the biggest inflation factor with an 8.8% increase for the 12 months to the September 2023 quarter.
In that time, grocery food prices are up 11%.
For the previous quarter, ending June this year, a 6.0% annual change in the CPI was recorded.
Stats NZ consumer prices senior manager Nicola Growden said at the time: "Prices are still increasing at rates not seen since the 1990s but are rising at a lower rate than the last few quarters."
'We are winning the war'
Kiwibank chief economist Jarrod Kerr said petrol was key to the transport increases, up 17% on the quarter.
"We lost another battle with the inflation beast, over the quarter," he said. "But we are winning the war, over the year.
"We're heading in the right direction... When you slice and dice the data, you get some pleasant surprises.
"The whole Kiwibank trading floor had a collective sigh of relief on these numbers."
Kerr said the numbers "significantly" reduce the likelihood of any further rate hikes from the Reserve Bank.
Political reaction
Labour leader Chris Hipkins said it was "good news for the economy".
"[It] shows that we leave the government's economic position in an improving position for the incoming government," he said.
ACT leader David Seymour took a different view.
"Today's Consumer Price Index (CPI) is a hangover from Labour's time in charge," he said in a statement.
"This has been one of the great failures of Grant Robertson's time as Finance Minister and is a big reason why New Zealanders overwhelmingly rejected Labour last weekend.
"His legacy is going to be a cost of living crisis off the back of huge government spending with no positive outcomes for Kiwis."
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