Fuel prices rocket up in New Zealand while food costs stay flat
Fuel prices in New Zealand rose 13 percent month-on-month in April while food inflation barely moved, the latest data show. Economists say the unusual gap will complicate the Reserve Bank's monetary policy path.
April data from Statistics New Zealand show that petrol prices rose 13 percent month-on-month nationally, with diesel up 37 percent. Food prices, by contrast, were nearly flat in the month, as supermarket operators say imported meat supply chains absorbed pressure through inventory buffers.
Retail sources interviewed by RNZ said they had never seen this kind of split and warned that shipping costs will eventually filter into shelf prices in the coming months. ANZ economists now expect headline inflation could rise above 4 percent in May.
The Reserve Bank of New Zealand left its policy rate unchanged at the last meeting. With the Iran-driven oil shock landing alongside flat food prices, the cutting cycle is likely to be pushed back. Markets expect a cautious tone at the RBNZ's July meeting and rate-cut bets have been trimmed.
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