Salads back on menu but petrol pressure remains

The days are getting longer and salads are finally coming down in price.

Inflation data out this week showed food prices fell by 0.4 per cent in September and were nearly flat on a seasonally adjusted basis.

Falling prices for fruit and vegetables such as tomatoes, cucumbers and lettuce were the biggest driver of the monthly fall, with prices down 3.9 per cent from August.

The effects of Cyclone Gabrielle and the bad weather in the North Island at the start of the year appear to have largely worked their way through the system.

It’s been a volatile year for the cost of fruit and veges with prices spiking 5.6 per cent in February immediately after the storms, followed by another sharp rise of 8.1 per cent in June.

But with the warmer weather, greens are flourishing. And it’s not just the veges where prices are looking better. Meat, poultry and grocery items all recorded no overall change in price for September compared with the previous month.

Over the year, prices were up 8 per cent but that is the lowest annual rise since July 2022. Food prices have been a large contributor to the overall cost-of-living rise.

The consumer price index for the September quarter is due out on Tuesday. That backward-looking data is unlikely to make consumers feel better, with the price of fuel expected to have pushed inflation higher again.

Global oil prices jumped earlier this week over concerns about the Israel-Hamas war but have since drifted back down again. Energy analysts worry that an expansion of the conflict beyond Israel and the Gaza Strip would push crude oil prices higher.

Petrol prices have crept up sharply in recent months with the subsidy coming off and could continue to rise, putting pressure on household finances. On top of that, Kiwibank noted this week that some 30 per cent of its home loan borrowers are yet to roll on to higher interest rates.

There are some signs of light at the end of the tunnel but still tight times ahead for Kiwi wallets.