Milk drinkers are big winners in the latest consumers price index.
New Zealand food prices fell in June, for a third monthly decline, with newly introduced seasonal adjustments showing cheaper vegetables helped drag down the index, Statistics New Zealand said.
"The average price for 2 litres of blue-top milk was $3.36 in June, down 9.4 per cent from its peak in November 2014," consumers price index delivery manager Matt Haigh said.
"The price of fresh milk is the lowest it's been since August 2013, when 2 litres of blue-top cost $3.17."
The food price index fell a seasonally adjusted 0.8 per cent in June, adding to the 0.1 per cent dip in May and a 0.5 per cent decline in April.
The government agency adopted seasonal adjustment for the series for the first time, which aims to smooth the impact of seasonal events such as annual fruit and vegetable cycles. Food prices fell 0.1 per cent on an annual basis.
On an unadjusted basis, food prices rose 0.5 per cent in June, reflecting the impact of winter on vegetable prices.
"Higher food prices in June were influenced by seasonally higher prices for fresh fruit and vegetables," consumers price index delivery manager Matt Haigh said in a statement.
"However, food prices fell 0.8 per cent this month after adjusting for seasonal increases for items such as tomatoes and lettuce."
Food prices account for about a fifth of the broader CPI, which dropped below the Reserve Bank's 1 per cent to 3 per cent target range, rising at an annual pace of 0.1 per cent in the year to March 31.
Statistics NZ will publish second-quarter inflation data later this week, which the central bank expects will show consumers prices rose at a 0.3 per cent annual pace.
Today's data shows vegetable prices fell 3.9 per cent in June, while fruit prices rose 1.3 per cent. Meat and poultry prices were down 3.5 per cent, while fish prices rose 0.9 per cent.
Grocery food prices declined 0.4 per cent, led by a 1.6 per cent decline in other grocery food, while bread and cereals were down 1 per cent and milk, cheese and eggs slipped 0.5 per cent.
Non-alcoholic beverage prices rose 0.6 per cent, and restaurant meals and ready-to-eat food prices advanced 0.2 per cent.
On an annual basis, fruit and vegetable prices rose 1.8 per cent, while meat, poultry and fish prices fell 1.9 per cent, grocery food prices dropped 2.1 per cent, non-alcoholic beverages rose 4.1 per cent, and restaurant meals and ready-to-eat food prices gained 1.9 per cent.
Bread prices showed the biggest annual decline, falling 8.7 per cent, followed by a 7.9 per cent fall in poultry prices, and a 6.7 per cent drop in fresh milk prices.
See the full report here: