Falling dairy prices are weighing on inflation, with the price of food falling for the second straight month.
Statistics New Zealand's latest food price index for the month of June showed a 1.4% increase over May, mainly driven by seasonal changes in the price of fruit and vegetables, which rose by 9%.
However, the basket of goods used to measure the food price index was 0.2% cheaper than in June 2011, and follows a similar 0.2% drop for May compared to a year ago.
Dairy was the main driver for the fall, with the price of fresh milk down 8% on a year ago, while cheddar cheese is 16% cheaper than 12 months ago, while butter is down 24%.
The price of bread is also 2.4% down on a year ago.
Between May and June the price of some goods rose sharply, with tomatoes up 42%, avocados up 37% and nectarines up 51%.
Statistics New Zealand said the price increases related to seasonal fluctuations.
Steak prices meanwhile dropped 9.2% between May and June, while cakes and biscuits dropped 4%.
Next week Statistics New Zealand will release the consumer price index - the most popular measure of inflation - for the June quarter.