Food prices fell by 1.3% in August from July due to big drops in tomato and banana prices over the month, figures released by Statistics New Zealand show.
Annually, food prices were up 6.6% from August 2010, down from 7.9% annual growth in July, figures show. That was still the biggest annual rise for an August month since 2008.
ASB economist Christina Leung said the annual increase reflected the higher living costs households were facing this year, although noted it was below the double digit growth seen in 2008.
"Nonetheless, the easing in August adds to recent inflation indicators which suggests the RBNZ has some breathing space on the inflation front for now. With the volatility in global markets dominating the RBNZ’s attention for now, we expect the RBNZ will leave the OCR on hold at the MPS this Thursday," Leung said.
Tomato prices sliced, banana prices slip
Tomato prices fell 25% in August after peaking in July.
"Tomato prices averaged just under NZ$10 a kg in August, after reaching more than NZ$13 a kg in July," Statistics NZ prices manager Chris Pike said in a media release.
Banana prices fell 21%, to their lowest level in five years. Good growing conditions overseas led to a temporary increase in imports, Pike said.
Four of the five food subgroups recorded price falls in August 2011. The meat, poultry, and fish subgroup fell 0.9%. The main contribution came from a 4.2% fall in fresh chicken prices, partly influenced by more discounting than in July, he said.
In August 2011, grocery food prices fell 0.3%, reflecting lower prices for cheese (down 5.4%), cakes and biscuits (down 2.7%), and yoghurt (down 6.2% after peaking in July). More discounting than in July contributed to these falls.
In the year to August 2011, food prices increased 6.6%, down from the 7.9% increase for the year to July 2011. Both increases included a 2.2% rise in October 2010, when goods and services tax rose.
All subgroups had price increases in the year to August 2011: grocery food (up 6.2%), fruit and vegetables (up 13.2%), restaurant meals and ready-to-eat food (up 4.2%), meat, poultry, and fish (up 5.0%), and non-alcoholic beverages (up 6.6%).
(Updates with ASB, Stats NZ comments)
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7 Comments
As our standard of living is eroded (buying power of our dollar goes down) making food a larger percentage of the household budget these food inflation figures are going to be the only inflation figures worth talking about.
Inflation of 6.6% is not a healthy environment for saving dollars. No wonder people put their money into property or gold instead.
In August 2011, grocery food prices fell 0.3%, reflecting lower prices for cheese (down 5.4%), cakes and biscuits (down 2.7%), and yoghurt (down 6.2% after peaking in July). More discounting than in July contributed to these falls.
All subgroups had price increases in the year to August 2011: grocery food (up 6.2%), fruit and vegetables (up 13.2%), restaurant meals and ready-to-eat food (up 4.2%), meat, poultry, and fish (up 5.0%), and non-alcoholic beverages (up 6.6%).
Is there any additional measurement of pack sizes? Even if prices fall slightly or stay the same it's still an increase if the quantity purchased is less.
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