Food prices fall for third month on cheaper veges, milk gets more expensive

New Zealand food prices fell for a third month due to cheaper vegetables which were in season, though more expensive milk pushed up prices over the year.

The food price index slipped 0.1 percent in December, adding to the 0.2 percent and 1 percent declines in the prior two months, according to Statistics New Zealand. On an annual basis, food prices were up 1.5 percent, accelerating from a 1.4 percent annual increase in November.

The monthly decline was led by a 3.7 percent fall in the price of vegetables, with cheaper lettuces, broccoli and cabbages, and were down 1.3 percent on the year.

Fresh milk prices rose 2.7 percent in December, and were up 9.4 percent on the year. More expensive dairy products were the main driver of the annual increase in food prices, with yoghurt up 10 percent, cheese up 7.7 percent and other milk products up 10 percent.

Last month the Reserve Bank gave a stronger signal in its monetary policy statement that interest rates will rise this year, noting that inflationary pressures are "projected to increase." Food prices make up almost 19 percent of the consumer price index, and the December CPI is scheduled for release next week.

Grocery food prices were flat in December, though up 2 percent in the year. Meat, poultry and fish prices rose a monthly 0.8 percent and an annual 1.6 percent.

Non-alcoholic drinks prices fell 2.1 percent in December, for an annual increase of 3 percent, and restaurant meals and read-to-eat foods prices increased a monthly 0.5 percent and an annual 1.9 percent.

(BusinessDesk)

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2 Comments & Questions

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How about free milk for nursing mothers?

... a programme of free milk for children in the schools and shanty towns of Chile ... Free milk was introduced for nursing mothers, ... eligibility for free milk extended from age 6 to age 15 ...
http://en.wikipedia.org/wiki/Salvador_Allende#Presidency

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Statistics are one thing - why is my weekly shopping price going up each year? Prices dropping for 3 months does not mean prices are cheaper. Either whoever puts this stuff out thinks the people are idiots or they are grossly incompetent and operate without a duty to paint a correct picture for the people. As usual its all spin to suck in the consumer. Milk will keep going up as Fonterra keep recalling products and become a global litigation defendant to billions of liability.

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