BELLINGTON. New Zealand’s annual inflation rose to 3 per cent in the September quarter of 2025, up from 2.7 per cent in the previous June quarter. This is the highest point within the Reserve Bank of New Zealand’s target range of 1 to 3 percent.

According to Stats NZ, the rate is the highest since the June quarter of 2024, when inflation peaked at 3.5 per cent. It was 3 percent. The biggest contributor to the rise in prices has come from the housing and household utility groups, with electricity, rent and local body taxes being the main factors. The combined impact of these items accounted for about 17 per cent of the Consumer Price Index.

The electricity rate is 11 per annum. It grew by 3 percent, the largest growth rate since March 1989.

Meanwhile, overall inflation has moderated as prices of medicines, telecom equipment and petrol have fallen. On a quarter-on-quarter basis, consumer prices rose one percent in the September quarter compared to the June quarter. This is mainly due to the increase in local body tax and the increase in vegetable prices by 12.2 percent due to seasonal reasons.

Acting Treasury Secretary Chris Bishop said he expected inflation to fall to 2 per cent in the first half of 2026, easing the pressure on consumers and businesses.