New Zealand food prices fell in March, adding to the evidence that inflation is benign, as prices fell for fruit and vegetables, such as apples and pumpkin, and for chicken pieces.
The food price index fell 1 per cent last month, according to Statistics New Zealand. Prices declined for all five sub-groups measured, the first time that has happened since October 2009. Prices rose 0.2 per cent compared to March 2011.
Food prices for March are the final component of consumer prices for the first quarter, which are due for release on Thursday and are expected to show there's little pressure on the Reserve Bank to raise interest rates soon. The inflation rate was 0.6 per cent in the first three months of the year, according to a Reuters survey.
Prices of fruit and vegetables fell 4.2 per cent in March, with the biggest declines recorded for apples, down 24 per cent as the harvest pushed an abundance onto the market, while pumpkin fell 26 per cent and grapes dropped 20 per cent. Potatoes declined 5.8 per cent.
Meat, poultry and fish prices fell 1.8 per cent, driven by a 4 per cent decline in the price of chicken pieces. Grocery prices fell 0.3 per cent, with chocolate biscuits falling 7.8 per cent. Bacon fell 6.5 per cent.
