The annual rate of inflation has broken through the 1 percent barrier for the first time in two years.
The consumers price index was 1.3 percent for the year to the end of December, says Statistics NZ, after it rose by 0.4 percent in the final quarter of 2016.
"This is the first time in over two years that price increases for household purchases have been over 1 percent", prices senior manager Jason Attewell said.
"Household price inflation is up from a historical low of 0.1 percent for the December 2015 year".
The December quarter rose by a seasonally adjusted of 0.7 percent followed a third quarter rise of 0.3 per cent.
"Higher prices for petrol, air fares, and new house builds were partly offset by lower prices for food and furniture," Mr Attewell said.
Petrol rose by 4.1 percent in the quarter with the average price of a litre of 91 octane rising by 7 cents compared to the previous quarter while food prices fell by 1.2 percent.