Rising food prices were the main contributing factor to the 0.7 percent rise in the Consumers Price Index in the March quarter, taking annual inflation to 3.4 percent.

The Statistics New Zealand figures show that during the March 2008 quarter, food prices rose 1.8 percent and grocery prices 3.6 percent. The high risers were many of the staple food items. Butter rose 33.9 percent, cheese was up 18.9 percent, and bread was 7.3 percent higher.

House rentals increased 1.2 percent, utilities were one percent higher and there was a 8.8 percent rise in electricity prices.

Petrol was up four percent for the quarter, mostly offset by lower prices for international air transport (down 8.6 percent).

For the year to the March quarter, the CPI rose 3.4 percent. A 20.5 percent rise in the price of petrol made the most significant contribution to the increase. Statistics NZ says if petrol prices had remained constant from the March 2007 quarter, the CPI would have risen 2.5 percent for the year to the March 2008 quarter.