Battling families will receive a weekly tax credit to offset the soaring price of fuel in New Zealand, amid warnings that the Iran war will hurt hip pockets for months to come.
The average price of a litre of unleaded 91 petrol has soared by a third to $NZ3.37 ($A2.82) a litre in New Zealand - and more in many regional locations.
With the cost of diesel spiking by 78 per cent to $NZ3.23 ($A2.70) a litre, the cost of fuel has sparked huge concern both for households and inflation-watchers.
New Zealand is in a prolonged economic downturn, with unemployment at decade-long highs, but headline inflation is already climbed back outside the Reserve Bank's (RBNZ) target band.
With a growing urgency to lessen the cost of living challenge, but those inflation concerns front of mind, Chris Luxon's government has opted to increase a weekly tax credit for working families.
Around 143,000 families with children will receive a $NZ50 ($A42) weekly rebate for either the next year, or when petrol drops back below $NZ3, whatever comes first.
Finance Minister Nicola Willis said the concession had been crafted carefully.
"This temporary boost will deliver support to working families who are under significant cost-of-living pressure, without making inflation worse or further driving up government debt," Ms Willis said.
In most cases, the measure will benefit households with an annual income of less than $NZ135,000 and begin in April.
The cost of living is likely to be the number one issue at the November 7 election, which polls indicate will be closely fought between Mr Luxon's right bloc and the Labour-led left.
Opposition Leader Chris Hipkins said, following a briefing from officials, Kiwis needed to be prepared for months of escalated fuel prices.
That would be shocking news for New Zealanders and the government, but there was at least some comforting advice from the RBNZ on Tuesday.
In a speech, the central bank's governor Anna Breman indicated she would "try to avoid reacting too early" to the price shock given New Zealand's fragile economic recovery.
The RBNZ's official cash rate is at a basement 2.25 per cent in order to foster growth and confidence in the Kiwi economy.
