Cheaper produce hides fuel's effect on groceries

Food prices fell 0.2 per cent in August, Statistics New Zealand says.

But while cheaper fruit and vegetables kept the monthly grocery spend down, the data indicate the secondary effects of higher fuel prices are beginning to flow through.

Grocery items such as soft drinks and confectionery, ready-to-eat meals, meat, fish and poultry - which must travel farther - all cost more in August.

The Food Price Index, which makes up about 18 per cent of the inflation-measuring Consumer Price Index, rose 2 per cent in the year to August.

Fruit and vegetable prices were down 2.7 per cent in August, due largely to a 41.5 per cent fall in the price of avocados and a 31.4 per cent fall for broccoli.

Offsetting those falls were rises for meat, fish and poultry, which rose 0.1 per cent; restaurant meals and ready-to-eat foods, up 0.2 per cent; and grocery foods, up 0.1 per cent.

- NZPA