Prime Minister Jacinda Ardern "absolutely refutes" claims the Government's billions of dollars in spending on COVID-19 led to record inflation. 

The price of goods and services in New Zealand increased 5.9 percent in the last three months of 2021 compared to the same period in 2020, according to Stats NZ. It was the biggest jump since a 7.6 percent annual increase in 1990.

According to ASB Bank, petrol prices saw a whopping 30.7 percent annual increase, while construction costs grew 15.7 percent, and rents went up 3.8 percent. And it's not going away anytime soon. 

"Our view has long been that high inflation in NZ is not transitory. Capacity bottlenecks, supply constraints and resilient demand conditions are expected to keep inflation elevated," said senior economist Mark Smith. 

Meanwhile, 42 percent of New Zealand workers did not get a pay rise at all in 2021, according to Stats NZ, and more than 80 percent of workers are getting pay rises less than inflation.

The latest results from Retail Radar show that in the fourth quarter - October, November and December - 57 percent of retailers increased prices. Nearly three-quarters of retailers expect to increase prices over the next three months by around 7.5 percent.

ANZ and ASB are forecasting the inflation rate will rise above 6 per cent early this year, if it hasn’t already.