New Zealand data: November Food Price Index -0.4% m/m (prior -0.3%)

New Zealand's Food Price Index (FPI) has recorded a month-over-month decline of -0.4%, while the year-on-year increase stands at 4.4%. This index is a crucial indicator as it influences nearly 19% of the Consumer Price Index (CPI), significantly impacting inflation. The recent comments from RBNZ's Governor Breman suggest that if the economy progresses as expected, the current 2.5% interest rate is likely to remain. The continuous monthly drop in food prices could indicate that persistent inflationary pressures may be easing. Food inflation has been a major concern for the RBNZ over the past two years and these recent statistics may bolster the bank's efforts to align inflation within their target range of 1-3%. Sustained moderation in food prices would alleviate cost-of-living pressures for households affected by rising mortgage rates, allowing for greater policy flexibility moving forward.