Food prices remained flat on a monthly basis in April according to the latest Selected Price Index from Stats NZ, but pressure at the fuel pump persisted as prices continued to rise. 

Prices for petrol in April were up 30.1% on an annual basis and 12.6% on a monthly basis, while diesel was up 91.3% on an annual basis and 36.6% on a monthly basis. 

Stats NZ prices and deflators spokesperson Nicola Growden said petrol prices had increased 33.6% and diesel 94.9% in the two months since February 2026. 

The conflict in the Middle East began at the end of February. 

Despite the rise in fuel and diesel costs, food price increases remained subdued in April. 

Prices for the overall food group increased by 2.6% in the 12 months to April 2026, after a 3.4% rise in March. 

Key food items that contributed to the annual increase included porterhouse/sirloin steak, beef mince, takeaway coffee and white bread. 

Items that recorded price decreases included olive oil and potato chips. 

Higher prices for the meat, poultry and fish group category contributed the most to the increase, up 7.8% on an annual basis and 0.1% on a monthly basis. 

Prices for restaurant meals and ready-to-eat food were the next largest contributor, up 2.7% annually and 0.3% monthly. 

Prices for the grocery food subcategory were up 0.7% on a monthly and annual basis, the largest monthly increase. 

The only categories to record a monthly price decrease were the fruit and vegetable subcategory, down 2.3% monthly but up 3.7% annually, and non-alcoholic beverages, down 0.3% monthly but up 1.2% annually. 

ASB chief economist Nick Tuffley said prices had risen less than expected, with signs the subdued consumer demand backdrop is tempering some cost-driven influences. 

“The Iran conflict has seen an escalation in geopolitical tensions and higher and more volatile fuel prices. The outlook is incredibly uncertain and there are a number of paths ahead for short-term inflation,” Tuffley said. 

“The trajectory of petrol and diesel prices will play an important role in impacting short-term CPI [Consumers Price Inflation]. Fuel is a key input into the NZ supply chain and there is the pronounced risk of a more widespread uplift in consumer prices.” 

He said hikes to the Official Cash Rate (OCR) still appear to be a matter of when, not if. 

Tuffley said he expected OCR hikes to move in 25 basis point increments, ending the year at 3.25%. 

Alcohol down, energy up 

Prices in the alcoholic beverages category fell 1% on a monthly basis but were up 1.5% on an annual basis. 

Cigarette and tobacco prices also fell monthly, dropping 0.4%, but were up 5.5% on an annual basis. 

Existing rent prices, known as the stock measure of rental property, increased by 0.4% annually but were flat month to month. 

The flow measure, which indicates prices for new rentals or tenancies in the market, was up 0.3% on an annual basis and up 0.2% on a monthly basis. 

Electricity and gas prices continued to rise, with prices for electricity up 13.1% annually and 2.4% monthly. 

Prices for gas increased by 10.8% annually and 0.3% monthly. 

Growden said electricity prices had been increasing every month from December 2024. 

Transport and accommodation 

Domestic air transport prices were yet to show much impact from the rising price of fuel, with prices down 6.9% on an annual basis but up 4.2% monthly. 

Growden said Easter, school holidays and Anzac Day fell in April this year, and that airfare pricing is set up 12 months in advance, meaning movements can be influenced by a range of factors. 

International air transport prices were down 6.5% annually but increased on a monthly basis by 6.2%. 

As for accommodation, domestic prices were up 2% on an annual basis but fell by 5.7% on a monthly basis, while international accommodation prices were down 2.5% annually and down 7.2% on a monthly basis. 

Westpac senior economist Satish Ranchhod said high prices for fuel and fertilizer will push production costs higher over the coming year. 

“The full impact of oil price rises through the supply chain is yet to be felt, and a sharp rise in inflation is still on the cards for the middle part of the year,” Ranchhod said. 

“Importantly, it will take time for the impact of higher fuel prices to be reflected in other consumer prices and for the related dampening impact [on] economic activity to be seen clearly. That leaves the Reserve Bank walking a tight rope – interest rates will need to rise, but the question is how soon and how quickly?" 

Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.