Some people are eating toast for dinner, due to the high cost of living, says Pakuranga Howick Budgeting Services manager Megan Dangen. Photo: 123rf
Aucklanders are not feeling optimistic despite inflation cooling to a two-year low.
Stats NZ data for the September 2023 quarter shows the annual inflation rate eased to 5.6 percent, down from 7.3 percent in June last year.
The consumer price index rose 1.8 percent for the three months from July to September, slightly less than expected.
Food was the largest contributor to the annual inflation rate - staples such as milk, cheese, eggs, bread and cereals increased almost 12 percent in the year to September.
Despite the dip in inflation, Aucklanders are still feeling the pinch.
"It feels like it's just going up and increasing all the time," said John, "it seems like they're trying to tax New Zealand out of existence".
Slava said the news of inflation easing seemed like "a lie", because prices seem to be heading upwards rapidly.
"We can hardly survive. My family are in financial hardship at the moment, because I have cancer and depression," Slava said.
"Considering that I only work for a limited number of hours due to my ill health, it's next to impossible to survive considering the prices".
One woman was hoping the incoming government would bring the tax cuts it promised.
"It's pretty hard. I think a lot of Aucklanders are just tired and anxious and a bit overwhelmed, to be honest, with everything on top of Covid," she said.
Housing and household utilities was the second highest driver of inflation, followed by transport.
Pakuranga Howick Budgeting Services manager Megan Dangen said it had been a difficult time for people.
"We are seeing situations where people just cannot afford to run their cars, buy decent groceries. It's just decreasing their standard of living because things are so expensive," Dangen said.
"Some of the clients that we've seen, they are just eating toast for dinner, because that's all they can afford."
Prices for fruit and vegetables continued to rise, though seasonal vegetables are more affordable. Photo: 123rf
Kiwibank chief economist Jarrod Kerr said inflation was easing faster than the Reserve Bank predicted.
"Inflation was running at 7.3 percent last year, now it's dropped all the way to 5.6 percent and we think it will be 4-point-something percent by the end of this year so we're moving in the right direction," Kerr said.
The drop significantly reduced the likelihood of any further interest rate hikes from the Reserve Bank.
Nicola Growden from Stats NZ said things were looking up.
"In previous quarters we had quite a high proportion of prices increasing or staying flat, but now that is starting to show a little bit of a drop-off and more prices are starting to fall."
New Zealand's inflation rate of 5.6 percent is better than the OECD average, from August, of 6.4 percent.
