Cost of living: Food prices rise by 12.1 percent, Statistics NZ says

Statistics NZ's food price index rose again in May amid soaring costs for fruit and vegetables.

The index rose by 12.1 percent from a year earlier, Stats NZ said on Wednesday. The April annual increase was 12.5 percent.

In the year to May, fruit and vegetable prices alone increased by 18.4 percent.

"The increase was driven by avocados, kūmara, potatoes and tomatoes," Stats NZ said.

In other notable increases, grocery prices surged 12.7 percent year-on-year. Stats NZ said that increase was driven by the rising cost of eggs, potato chips and lollies.

While fruit and vege prices were up significantly year-on-year, they dipped 2.5 percent month-on-month - attributed to decreasing prices for the likes of mandarins and kiwifruit.

"Food prices are on track to make a solid positive contribution to Q2 CPI (consumer price index) inflation," ASB senior economist Mark Smith said.

"Encouragingly, we have continued to see some retracement in fruit and vegetable prices from the earlier cyclone boost, pricing pressures in the grocery foods sector look to be easing and price rises look to be less widespread.

"It is our hope that annual food price inflation has peaked (or is close to it) given lower global food commodity prices."

For now, however, consumers were "likely to remain under the pump given elevated living cost increases", he said.