The Consumer Price Index (CPI) inflation rate in New Zealand hit 6.0% in the 12 months to June 2023, according to data released by Stats New Zealand on the 19th of July 2023. This is the lowest level of annual inflation since late 2021. The CPI quarterly rate rose 1.1%, this is the lowest quarterly increase since March 2023.
The main contributors to this CPI release were food and housing. Food prices rose by 2.2% in the quarter, while housing and household utilities prices rose by 1.1%. Food prices were driven by increases in the prices of fruit and vegetables, meat, poultry, and fish. Housing and household utilities prices were driven by increases in the prices of rent, electricity, and gas.
The fall in the annual inflation rate was due to several factors, including the easing of supply chain disruptions and the decline in global oil prices. However, inflation is still expected to remain above the Reserve Bank's target range of 1-3% for some time.
The Reserve Bank has raised the Official Cash Rate (OCR) 525 basis points since October 2021 to bring inflation under control. The OCR is currently at 5.5%, its highest level since 2008.