logo
Inflation increases to 2.7%

Inflation increases to 2.7%

1News21-07-2025
Inflation has increased to a 12-month high of 2.7%, according to official figures out from Stats NZ today.
The increase in the 12 months to the June quarter followed a 2.5% increase in the 12 months to the March 2025 quarter.
"Although the annual inflation rate increased from the March 2025 quarter, it remains within the Reserve Bank of New Zealand's target band of 1 to 3% – the fourth consecutive quarter it has done so," Stats NZ prices and deflators spokesperson Nicola Growden said.
The largest contributor to annual inflation was local authority rates and payments, up 12.2%.
Growden said rates contributed 13% of the 2.7% annual increase and were captured yearly in the September quarter.
ADVERTISEMENT
"The 12.2% annual increase for rates was captured in the September 2024 quarter. Next quarter we will capture changes in rates as of 1 July 2025."
Petrol prices made a "significant downward contribution" to inflation, she said, with a decrease of 8%.
"The CPI excluding petrol increased 3.2% in the 12 months to June 2025."
The average price for one litre of 91 octane fuel was $2.54 in the June 2025 quarter, down from $2.76 in the June 2024 quarter.
Rent prices also increased, up 3.2% in the 12 months to the June 2025 quarter, and contributing 13% to the 2.7% inflation increase.
"The 3.2% increase in rents is the smallest annual increase in four years. Rents increased 2.9% in the 12 months to June 2021."
Inflation remains 'under control' - Willis
ADVERTISEMENT
Nicola Willis (file). (Source: 1News)
Finance Minister Nicola Willis said inflation "remained under control" and within the Reserve Bank's target range.
"It's the fourth consecutive quarter inflation has remained within the target range – a stark contrast to under the previous government, where inflation raged on unchecked, reaching 7.3% in 2022."
While it was "pleasing" to see non-tradeables inflation continue to fall, she said the effect of council rates on inflation was a "concern".
"That's why this Government has also been clear in its call to councils to focus on the basics and keep rates under control. We look forward to councils taking heed of this and playing their role as stewards of ratepayers' money better in the future."
Willis added that external pressures on inflation remained and that the country "must remain cautious".
"It's a reminder that the economic recovery is not to be taken for granted."
ADVERTISEMENT
'Failing by its own standards': Opposition hits out at Govt over inflation
Barbara Edmonds (Source: 1News)
The Opposition accused Prime Minister Christopher Luxon and the coalition Government of "making excuses" and "failing by its own standards" on the back of the inflation increase.
Labour's finance spokesperson Barbara Edmonds said the figures released today showed the cost of living crisis was "getting worse under National".
"Christopher Luxon promised to make the cost of living better, instead, he's making it worse, He has been making excuses for 18 months now. People are sick of it."
She accused Luxon of being "completely out of touch" with the needs of middle New Zealand.
ADVERTISEMENT
"Food prices are surging with butter up nearly 50%. Rates are up over 12%, electricity is up over 8%, and everyday costs continue to rise, yet this Government keeps siding with property speculators and fossil fuel companies while families are left behind."
Green Party co-leader Chlöe Swarbrick. (Source: 1News)
Green Party co-leader Chlöe Swarbrick said the inflation numbers exposed a "government failing by its own standards while our most vulnerable pay the price".
"Luxon's Government is cutting investment and creating the conditions for severe unemployment, shredding the social safety net, pushing thousands into poverty, and then punishing them for it."
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

One year, 27,850 jobs gone Stats NZ latest data shows
One year, 27,850 jobs gone Stats NZ latest data shows

RNZ News

time22 minutes ago

  • RNZ News

One year, 27,850 jobs gone Stats NZ latest data shows

Photo: 123RF New data shows there were 27,850 fewer jobs in New Zealand in June compared to the year before, and young people are feeling the impact of the weak labour market . Stats NZ's latest data shows the number of filled jobs was up 0.1 percent month-on-month but down 1.2 percent year-on-year. Compared to the year before, construction had lost 12,169 jobs, or 6 percent, manufacturing 5850 jobs, or 2.5 percent, professional, scientific and technical services 5150 jobs, or 2.7 percent, and admin and support services 4860 jobs, or 4.7 percent. Education and training and primary industries added jobs. People aged 15 to 19 had 10 percent fewer jobs, those 20 to 24 had 3.5 percent fewer and those ages 25 to 29 had 3.9 percent fewer. Hugh Hawkins, 23, has been looking for a job since finishing an honours degree last year. "Now we're in late July and I've managed to find a tiny bit of casual work through connections of people I know. Otherwise I've been serially ghosted with absolutely no success." Hawkins had set a target of 10 applications a week. "A couple of jobs I was excited for, I felt genuinely directly qualified for, I've gone for and not reached the interview stage. The rejection email often comes with a total of applicants they've had and one I was qualified for had 630 people apply." It seemed a widespread problem, Hawkins said. "Chatting to my coworkers they're virtually all in the same situation. They have to rely on the benefit to pay rent with casual work on the side. People from different walks of life, most young and very qualified…I worked hospitality roles through uni and took volunteer roles and internships relevant to my degree to set myself up as well as possible… if I'm struggling it must mean terrible things for what other people are also going through." Infometrics economists noted that May's month-on-month increase in filled jobs had been revised down in the latest data to a decline. "June's narrow rise could also be revised to flat or negative growth in future releases." Auckland had a 1.9 percent year-on-year fall in filled jobs and Wellington was down 2.3 percent. Canterbury was up 0.1 percent. ASB senior economist Mark Smith said it had been noticeable in the last year or so that young people were being most affected. He said there were likely to be more job losses than the data indicated because some businesses would have added roles during the year. "This is normally a cyclical phenomenon. The hope is that some will go into training if it's available but it's not available for everyone. "The labour market tends to be the last thing to move." He said it was concerning that the revisions in the data in recent months had all been down. "The trend is still falling. It has dragged on… Covid was huge and there are hangovers from that." He said the unemployment rate was likely to move higher in the coming months. Some people who had lost work had dropped out of the labour market, which meant the participation rate fell. The unemployment rate only counts people looking for work. "If that participation rate did not keep falling we would have a much higher unemployment rate, it would be closer to six. "Really the primary sector and the South Island are the good news stories. There is weakness still in the goods sector and the major centres." BNZ chief economist Mike Jones said he still expected the "mid-year activity air pocket" would pass. "The underlying drivers of the recovery remain in place and should reassert themselves in coming quarters. "But the recent weakness does push back the likely timing of the eventual labour market recovery. We doubt the current undershoot of firms' labour requirements relative to worker availability will change appreciably this side of Christmas. Our forecast peak in unemployment has been shunted out to 5.4 percent in the final quarter of the year. Wage growth should thus continue to slow through to the middle of next year." Green Party spokesperson for social development and employment Ricardo Menendez-March called on the government to "take charge and create jobs that help us build a better future". He said the Green Job Guarantee in the party's alternative budget would create 40,000 jobs to rebuild infrastructure, restore nature and build state housing. "We know people out there need opportunities, instead they are being punished and pushed into poverty."

One year, 27,850 jobs gone
One year, 27,850 jobs gone

RNZ News

timean hour ago

  • RNZ News

One year, 27,850 jobs gone

Photo: 123RF New data shows there were 27,850 fewer jobs in New Zealand in June compared to the year before, and young people are feeling the impact of the weak labour market . Stats NZ's latest data shows the number of filled jobs was up 0.1 percent month-on-month but down 1.2 percent year-on-year. Compared to the year before, construction had lost 12,169 jobs, or 6 percent, manufacturing 5850 jobs, or 2.5 percent, professional, scientific and technical services 5150 jobs, or 2.7 percent, and admin and support services 4860 jobs, or 4.7 percent. Education and training and primary industries added jobs. People aged 15 to 19 had 10 percent fewer jobs, those 20 to 24 had 3.5 percent fewer and those ages 25 to 29 had 3.9 percent fewer. Hugh Hawkins, 23, has been looking for a job since finishing an honours degree last year. "Now we're in late July and I've managed to find a tiny bit of casual work through connections of people I know. Otherwise I've been serially ghosted with absolutely no success." Hawkins had set a target of 10 applications a week. "A couple of jobs I was excited for, I felt genuinely directly qualified for, I've gone for and not reached the interview stage. The rejection email often comes with a total of applicants they've had and one I was qualified for had 630 people apply." It seemed a widespread problem, Hawkins said. "Chatting to my coworkers they're virtually all in the same situation. They have to rely on the benefit to pay rent with casual work on the side. People from different walks of life, most young and very qualified…I worked hospitality roles through uni and took volunteer roles and internships relevant to my degree to set myself up as well as possible… if I'm struggling it must mean terrible things for what other people are also going through." Infometrics economists noted that May's month-on-month increase in filled jobs had been revised down in the latest data to a decline. "June's narrow rise could also be revised to flat or negative growth in future releases." Auckland had a 1.9 percent year-on-year fall in filled jobs and Wellington was down 2.3 percent. Canterbury was up 0.1 percent. ASB senior economist Mark Smith said it had been noticeable in the last year or so that young people were being most affected. He said there were likely to be more job losses than the data indicated because some businesses would have added roles during the year. "This is normally a cyclical phenomenon. The hope is that some will go into training if it's available but it's not available for everyone. "The labour market tends to be the last thing to move." He said it was concerning that the revisions in the data in recent months had all been down. "The trend is still falling. It has dragged on… Covid was huge and there are hangovers from that." He said the unemployment rate was likely to move higher in the coming months. Some people who had lost work had dropped out of the labour market, which meant the participation rate fell. The unemployment rate only counts people looking for work. "If that participation rate did not keep falling we would have a much higher unemployment rate, it would be closer to six. "Really the primary sector and the South Island are the good news stories. There is weakness still in the goods sector and the major centres." BNZ chief economist Mike Jones said he still expected the "mid year activity air pocket" would pass. "The underlying drivers of the recovery remain in place and should reassert themselves in coming quarters. "But the recent weakness does push back the likely timing of the eventual labour market recovery. We doubt the current undershoot of firms' labour requirements relative to worker availability will change appreciably this side of Christmas. Our forecast peak in unemployment has been shunted out to 5.4 percent in the final quarter of the year. Wage growth should thus continue to slow through to the middle of next year." Green Party spokesperson for social development and employment Ricardo Menendez-March called on the government to "take charge and create jobs that help us build a better future". He said the Green Job Guarantee in the party's alternative budget would create 40,000 jobs to rebuild infrastructure, restore nature and build state housing. "We know people out there need opportunities, instead they are being punished and pushed into poverty."

Unemployment: Job data show construction down more than 12,000 in year, more youth out of work
Unemployment: Job data show construction down more than 12,000 in year, more youth out of work

NZ Herald

timean hour ago

  • NZ Herald

Unemployment: Job data show construction down more than 12,000 in year, more youth out of work

In 2022, many employers were desperate to find staff. But borders reopened, migrants arrived and the economy's post-Covid rebound slowed down. Gordon said young people were also often in the firing line for layoffs. He said recent data also indicated more people were staying unemployed for longer. 'Once you're out, it is hard to get back in ... What we've been seeing in recent surveys is the six- to 12-month group has risen quite substantially.' Job numbers for people aged 20 to 34 dropped by thousands compared with a year ago. But the cohort aged 35 to 39 filled 2% more jobs than a year earlier, according to Stats NZ. Economist and former Child Poverty Action Group spokeswoman Susan St John said support and benefits for some unemployed people were still miserly. St John said that wasn't always a problem if unemployment lasted a few weeks, but in a prolonged recession, it could be disastrous. 'It's why we continue wallowing around in this ugly recession. Our fiscal cushions are not well-designed.' GDP grew by 0.8% in the first quarter of this year but since 2022, Stats NZ has recorded four quarters of GDP decline, one flat and eight of growth, not adjusted for population. Last year, annual real gross national disposable income fell 0.3% and annual real gross national disposable income per capita fell 2.0%. St John, an associate professor at the University of Auckland Business School, said the country had major gaps in the safety net for some people in relationships. An unemployed central Auckland man aged 25 with cash assets of $1000, paying $300 a week in rent, with a partner working fulltime at the minimum wage, would qualify for only $74 a week before tax on Jobseeker Support. If single, the same man would qualify for Jobseeker Support of between $356 and $361 a week before tax, and a weekly accommodation supplement of between $70 and $147. St John said lack of demand in the economy, which she blamed on restrictive Government fiscal policy, was behind the decline in young adults filling jobs. Compared to June 2024, filled jobs in construction were down 6%, or 12,169 jobs. Manufacturing was down 2.5% or 5850 jobs year-on-year in the latest Stats NZ data. But across all industries, there was a 0.1% increase in filled jobs last month compared with the previous month. 'Construction is a quite cyclical and quite interest-rate-sensitive part of the economy,' Gordon said. He said the country recorded a surge in building consents for a couple of years after Covid. 'There tends to be quite a long pipeline from consent to completion. 'We have seen housing consents stabilise over the past year.' For that reason, the medium-term outlook for construction was not abysmal but recovery in construction jobs was still likely a few months away, Gordon said. He said employment was down in the North Island, but steadier in the South Island. 'The strong performance of the agri-sector is a big part of that.' Gordon said feedback from customers and colleagues often illustrated stark regional contrasts. 'In the North Island, there'll be a litany of woes. In the South Island, it's '$10 milk price, everything's all right'.' Seek's June employment report was also released today. It showed job ads were down 3% on May and 3% down on a year earlier. But Gisborne, Marlborough and Southland bucked the trend, with job ads in those regions up from the month before. Seek NZ country manager Rob Clark said job ad levels had been broadly flat for the past year. 'While the volume remains below pre-Covid levels, there are pockets of growth, which should be cause for some optimism.' John Weekes is a business journalist mostly covering aviation and court. He has previously covered consumer affairs, crime, politics and court.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store