The New Zealand selected price indexes for July came in weaker than expected, suggesting some downside risk to the September quarter consumer price index (CPI) forecast of 0.8% quarter over quarter, ANZ Research said in a Monday note.

The selected price indexes fell 0.3% month over month, meaningfully weaker than its expectation of a growth of 0.5% over the period.

Food prices, which account for nearly 19% of the CPI basket, rose 0.1% month over month, weaker than the 0.9% monthly reading forecast by ANZ. Meanwhile, alcohol and tobacco, accounting for 5.3% of the CPI basket, fell 0.3% over the period, weaker than the expectation of 0.4% growth.

While some of the surprise came from the more volatile components in the selected price indexes, ANZ said some of the more slow-moving and persistent indexes surprised to the downside as well, such as rents, which represent over 11% of the CPI basket, and which fell 0.1% in July, compared with the forecasted growth of 0.1%. The flow measure of rents fell 0.6%, which after accounting for seasonality is consistent with broadly flat rents, ANZ added.