New Zealand households are facing continued inflationary pressure, with grocery prices rising 4% annually and 2.3% in the latest month, according to data released today. The increases are impacting a wide range of essential goods, from coffee and beef to fruit and vegetables.
Coffee prices have seen a particularly sharp increase, rising by 32 cents over the past year to $1.12 higher than five years ago. This follows a significant 20% price jump since 2024, reaching $4.27 per pound as of September 2025, up from $3.44 in December 2024. Factors contributing to the higher coffee costs include drought conditions in Brazil and Vietnam, trade disruptions, and tariffs enacted during the Trump administration.
Meat, poultry, and fish prices also contributed significantly to the overall increase, climbing 8.9% annually and 3.2% monthly. A beef porterhouse or sirloin steak now averages $45.48 per kilogram, a 22.9% increase year-over-year. Although some produce prices have fluctuated, with tomatoes experiencing an 8.9% monthly decrease to $5.70 per kilogram, fruit and vegetable prices overall grew by 6.3% annually and 6.7% monthly.
Non-alcoholic beverages increased by 4% annually and 2.7% monthly, while restaurant meals and ready-to-eat food saw a more modest rise of 2.6% annually and 0.2% monthly. Chocolate boxes experienced a substantial monthly increase of 62.8%, averaging $12.57 per 250g box.
Beyond food, prices for alcohol, cigarettes, and tobacco also rose, with alcoholic beverages up 0.3% annually and 0.7% monthly, and cigarettes and tobacco increasing 5.4% annually and 3.4% monthly. Rent prices are also trending upwards, with the stock measure of rental properties increasing 1.2% annually, while new rentals or tenancies saw a more substantial increase of 1.6% annually and 5.6% monthly.
Energy costs remain a concern, with electricity prices up 11.5% annually and gas prices up 14.1% annually, despite a slight monthly decrease of 0.1%. However, petrol and diesel prices have decreased, falling by 2.4% and 3.2% respectively from December 2025 to January 2026, and also decreasing on an annual basis by 4.8% and 4.9% respectively. This marks the first time both fuel types have decreased in price monthly and annually since June 2025.
Travel costs present a mixed picture. Domestic air transport prices are down 5.5% annually and monthly, while international air transport prices are up 4% annually but down 13.8% monthly. Domestic accommodation prices rose 1.5% annually but fell 0.5% monthly, while international accommodation prices increased 1.4% annually but decreased 10.1% monthly.
The data indicates that prices for all food subgroups increased in a month for the first time since June 2025.