New Zealand annual inflation hits 2.7 pct as rates, rents up

Alsharq Tribune-AFP 

New Zealand's annual inflation rate climbed to 2.7 percent in the year to June 2025, driven by sharp increases in local authority rates and rising rents.

The statistics department Stats NZ showed on Monday that this marks a slight rise from the 2.5 percent recorded for the 12 months ending March 2025, but keeps inflation within the Reserve Bank's targeted 1-3 percent range for the fourth consecutive quarter.

Petrol prices, falling 8 percent year-on-year, helped offset the upward pressure from housing-related costs, Stats NZ said, adding that had petrol been excluded, annual inflation would have been 3.2 percent in the 12 months to June 2025.

The main driver of inflation was a 12.2 percent rise in local authority rates, contributing 13 percent to the annual increase, said Stats NZ prices and deflators spokesperson Nicola Growden.

Rent prices rose by 3.2 percent over the year, the smallest annual increase in four years, statistics show.

Quarterly inflation rose 0.5 percent in the June 2025 quarter, driven by a 9.5 percent rise in cultural services and a 4.9 percent jump in electricity prices, the largest in over a decade. Falling petrol prices, down 4.8 percent, helped offset the increase, Stats NZ said.