Wellington, Dec 16 (NationPress) In the year leading up to November 2025, food prices in New Zealand saw an annual increase of 4.4 percent, a slight decrease from the 4.7 percent rise recorded in the previous year until October 2025, according to a report from Stats NZ released on Tuesday.

The primary factor behind this annual increase was a 4.6 percent rise in grocery prices, with meat, poultry, and fish seeing a substantial 7.7 percent rise year-on-year, as noted by the Statistics Department.

Particularly striking was the average cost of a two-litre bottle of milk, which increased by 15.8 percent annually, while prices for sirloin beef steak soared by 26.7 percent, and white loaf bread surged by 53.2 percent compared to the previous year. Stats NZ spokesperson Nicola Growden remarked, "A loaf of white bread is now 74 cents more expensive than it was this time last year," highlighting the impact on household budgets.

In a monthly context, food prices fell by 0.4 percent in November, primarily attributed to a 4.5 percent decrease in the prices of fruits and vegetables as seasonal items like tomatoes and strawberries became less expensive.

Earlier in November, the Reserve Bank of New Zealand reduced its benchmark interest rate by 25 basis points to 2.25 percent, marking the Official Cash Rate (OCR) at a three-year low in a bid to bolster economic recovery.

While the annual consumer price inflation rose to 3 percent in the September quarter, forecasts suggest it may decline to around 2 percent by mid-2026 as the economy absorbs existing price pressures, according to a statement from the Reserve Bank.

This was the ninth reduction since the rates peaked at 5.5 percent in July 2024. Future adjustments to the OCR will rely on the evolving outlook for medium-term inflation and economic conditions.

The central bank indicated that while economic activity was sluggish during mid-2025, it is now showing signs of improvement, with lower interest rates encouraging consumer spending and a decrease in the exchange rate benefiting export revenues.

Global economic growth has seen a boost from robust investments in artificial intelligence, though a slowdown is anticipated in 2026 due to trade barriers affecting overall activity.

The statement also mentioned that the risks to the inflation outlook are balanced, noting that increased caution from households and businesses could hinder New Zealand's economic recovery.

"Conversely, a faster recovery could occur if domestic demand responds positively to reduced interest rates," the statement added.

Finance Minister Nicola Willis expressed optimism, stating, "New Zealanders have faced challenging times, but the outlook is improving," and highlighted that many Kiwis are seizing the chance to purchase their first homes amidst lower interest rates.