In the December 2025 quarter, New Zealand's annual inflation rate climbed to 3.1%, marking the highest rate since the June 2024 quarter. This was an increase from the previous period's 3.0% and slightly surpassed expectations. The primary factors contributing to this rise were within the housing and household utilities sector. Notably, electricity soared by 12.2%, the highest increase since the March 1989 quarter, while local authority rates and payments rose by 8.8%, and rent increased by 1.9%.
On a quarterly basis, the Consumer Price Index (CPI) saw a 0.6% increase, following a 1.0% rise in the previous quarter. The most significant upward pressure came from international air transport, which increased by 7.2%, with petrol also contributing to the rise with a 2.5% increase. However, the quarterly inflation rate was somewhat tempered by a 16.5% drop in vegetable prices, largely due to seasonal decreases in the prices of tomatoes, cucumbers, capsicums, lettuce, and broccoli.
