New Zealand's second quarter consumer price index rose 4.1 percent from a year earlier, the highest in two and a half years, according to Statistics New Zealand. The increase exceeded analyst expectations of 4.0 percent and the Reserve Bank of New Zealand's forecast of 3.9 percent, strengthening expectations of a policy rate hike in September. On a quarter-on-quarter basis, prices rose 1.5 percent, above the 1.4 percent median forecast in a Reuters poll of economists. The largest contributor to inflation was petrol, which rose 27.5 percent, while diesel prices surged 71.1 percent. Without these, the annual increase would have been just 2.9 percent. Non-tradeable inflation was 3.4 percent year-on-year, the lowest in five years, down from 3.5 percent in the first quarter.