Household living costs jump 7.2 percent

Living costs are still surging for New Zealand households despite a slight easing in general consumer inflation.

Released by Statistics NZ on Thursday, the living costs price index measures how inflation is affecting different household groups.

Annual household living cost inflation was 7.2 percent in the year to June, while general price inflation was 6 percent during the same period.

The latest household living costs figure was, however, slightly down from the previous quarter's 7.7 percent.

Food-related costs were the biggest drivers of the yearly increase.

Over the past year, food prices rose by 12.7 percent for the average household.

Living costs for the highest-expenditure household group rose 7.8 percent in the year to June. That was followed by Māori (7.1 percent).

For the lowest-expenditure household group, living costs rose 6.9 percent over the year.

Over the quarter, all of those groups' living costs rose by 1.4 percent.

The overall quarterly rise in household living costs was also 1.4 percent, Stats NZ said.

Ahead of Thursday morning's release of the data, ASB had said a "strong reading" was expected as the Reserve Bank (RBNZ) "continues to tighten the monetary policy screws to get inflation down". 

ASB is fallen to 6 percent from 6.7 percent last week.  

"Cashflow pressures for households are expected to remain acute given high (but slowly declining) inflation and higher mortgage payments for those refixing mortgage rates," ASB said in its Economic Weekly report.

"Signs the housing market has plateaued and that interest rates are close to peaking are expected to continue to provide some support to household sentiment."

In its July monetary policy review, the Reserve Bank said inflation was expected to continue declining in the near term - keeping the official cash rate the same (5.5 percent) for the first time in nearly two years. 

"Indeed, the RBNZ reiterated in July that it thought it had lifted rates far enough into restrictive territory to push inflation lower over time," ASB said.