New Zealand’s Food Price Index (FPI) saw its lowest annual food price increase since December of 2021 according to StatsNZ. While food prices were broadly higher across the five main categories for the year ended December, December also saw a fourth consecutive month of MoM declines in food inflation.
Monthly food prices fell 0.1% in December, a slowly pace of declines than November’s 0.2% downturn, but still a step lower.
Food prices still remain notably higher than this time last year, despite a total of 5 out of 12 months of headline FPI declines.
Grocers and non-alcoholic beverages were up 5.4 and 5.5% over the year respectively, while restaurants and ready-to-eat foods saw the biggest gains of 7.1%. Fruits and vegetables kept the overall numbers from going much higher, seeing only 1.5% in overall price gains YoY.
Market Reaction
The NZD/USD is trading in-line with near-term momentum in early Thursday trading, holding onto a recovery back above the 0.6100 handle from earlier Wednesday.
About New Zealand’s Food Price Index
The Food Price Index (FPI) released by the Statistics New Zealand measures price changes of food bought by households. New Zealand depends upon exporting agricultural goods and food products. Thus, high food prices relatively suggest an increase of trade interests. A high reading is seen as positive (or bullish) for the NZD, while a low reading is negative (or Bearish)
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