Excluding petrol and tobacco products, annual CPI rose by a smaller 1.5%.
Why does the government have to track food and other prices in such a granular way?
The cost of living is rising at the fastest rate in more than five years, with inflation jumping on the back of higher food and fuel prices.
Official numbers show inflation of 1 percent for the three months ended March, pushing the annual rate to 2.2 percent, the highest since mid-2011.
A better than expected CPI reading out of New Zealand triggered a surge higher in NZD/USD in early trading but gains were not sustained as sharp fall in early European trading served to erase most of the early day gain. This rule was applied to the New Zealand Dollar on April 20 when it jumped in response to news New Zealand's annualised inflation rate had risen to 2.2%.
The CPI rose 1 percent in the March 2017 quarter from the December 2016 quarter, when it rose by 0.4 percent.
"We expect food prices will remain elevated over coming months due to poor weather affecting crops", Tuffley said.
"The NZD trade weighted index is weaker than what the RBNZ had forecast earlier this year in February".
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"The latest spending numbers showed that the average dollar amount per year that all USA households spent on ice cream was $54.04, while the average amount on bacon was $39.07", Henderson says.
Housing-related prices were up 3.3 percent, while transport prices rose 3.5 percent.
Cheap oil in recent years and the tepid inflation environment has made life hard for New Zealand's Reserve Bank, which delayed cutting interest rates too aggressively for fear of stoking demand for an already hot property market. In New Zealand, the Consumer Price Index or CPI measures changes in the prices paid by consumers for a basket of goods and services.
- Annual inflation in March 2.2%, quarterly inflation 1%.
New Zealand's two-year swap rate rose 2 basis points to 2.3 percent and 10-year swaps rose 4 basis points to 3.26 percent.
Inflation in the quarter rose 1%, ahead of the Reserve Bank's forecast of 0.4% and the market expectations of 0.8%.
"The National Party frequently offers low interest rates as evidence for their claim that housing is still affordable in New Zealand, but today's inflation figures show that the mirage is disappearing".