Petrol fuels inflation rise

The consumers price index (CPI) increased 4.1 per cent in the year to June, according to new figures from Stats NZ.

It follows a 3.1 per cent rise in the 12 months to the March 2026 quarter, with Stats NZ noting the Reserve Bank of New Zealand’s target band for the annual inflation rate is one to three per cent.

The largest upwards contributor to the annual inflation rate was petrol, up 27.5 per cent.

Nicola Growden, prices and deflators spokesperson, says higher petrol prices accounted for almost a quarter of the 4.1 per cent annual increase.

Diesel prices also increased by 71 per cent and made a 7.7 per cent contribution to the latest annual inflation rate.

Stats NZ says households spend about eight times more on petrol than on diesel, which means petrol prices have a larger impact on the CPI.

If petrol and diesel prices had not changed, the CPI would have risen 2.9 per cent in the 12 months to the June quarter.

Other major contributors to the annual increase were electricity going up 12 per cent, local authority rates and payments climbing 8.8 percent, and construction of new housing climbing 2.7 per cent.

As for the transport group, its prices increased 10.6 per cent year-on-year. This included the purchase of vehicles rising by 1.3 per cent and private transport supplies and services soaring by 19.1 per cent.

When it came to quarterly inflation, the CPI rose 1.5 per cent in the June 2026 quarter when compared with the March period.

Higher petrol prices were the largest contributor to the quarterly inflation rate after rising 20.1 per cent. Diesel prices also increased by 47.7 per cent over the same period.

“Together, petrol and diesel accounted for almost two-thirds of the 1.5 per cent quarterly increase,” Growden adds.

Excluding the effect of petrol and diesel, the CPI rose 0.5 per cent in the June 2026 quarter. Petrol and diesel prices rose in the month of April and fell in May and June.

The transport group grew by six per cent quarter-on-quarter, with prices for purchasing vehicles alone falling by 0.2 per cent.