He said BNZ had expected inflation to lift 0.3 per cent on the quarter but raised that forecast to 0.4 per cent after government figures showed food prices jumped 1 per cent in March.
Build up inflation rate in the financial year so far was 2.47 percent compared to a build up rate of 5.11 percent in the corresponding period of the previous year.
The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.04 percent, the yield on the long-term 30-year note almost steadied at 0.70 percent and the yield on short-term 2-year remained flat at -0.15 percent by 04:50 GMT.
The index for this major group declined by 0.5% to 127.4 (provisional) from 128 (provisional) for the previous month.
The inflation based on Consumer Price Index (CPI), a key data factored in by the RBI to arrive at interest rate, was 4.44 per cent in February.
The index for "food articles" group declined by 0.4 per cent to 137.2 from 137.8 for the previous month, despite a price rise in items like ragi, jowar, peas/chawali, moong and paddy, among others. However, the price of raw silk (7%), mesta and hides (raw) (5% each), sunflower (4%), soyabean (3%), fodder (2%) and raw wool, coir fibre and raw rubber (1% each) moved up. However, the price of iron ore (15%), chromite (13%), manganese ore (6%), limestone (5%) and zinc concentrate and lead concentrate (1% each) moved up.
The index for "Crude Petroleum & Natural Gas" group declined by 0.5 percent to 80.2 from 80.6 for the previous month due to lower price of crude petroleum.
The index for this major group declined by 0.1% to 98 (provisional) from 98.1 (provisional) for the previous month.
Japan's exports were expected to rise for a 16th straight month in March and to maintain a rising trend, but the strong yen was seen likely to curb the pace of growth, a Reuters poll showed on Friday.
The index for manufactured goods rose by 0.4 percent to 115.7 (provisional) from 115.2 (provisional) for the previous month. This index holds 64.23% of WPI.
Despite keeping rates on hold, the committee said that "ongoing tightening of monetary policy" would be needed to bring inflation back to the Bank's 2 per cent target. Inflation based on wholesale prices eased to an eight-month low of 2.47 per cent in March on cheaper food articles, including pulses, vegetables and eggs.