Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Data Flash: Producer Prices Q2/2000

Data Flash: Producer Prices Q2/2000


Data Flash (New Zealand) Producer Prices Q2/2000

Key Points

Producer input prices rose 1.2% qoq in Q2 and were 5.5% higher than in mid-1999. Producer output prices rose 1.0% qoq and were 3.9% higher than last year. Higher commodity prices and the flow-on effects into manufacturing production and the distribution sector were the key drivers of both indexes. Surprisingly, despite the collapse in building activity, construction cost inflation continued at an annualised rate of around 2.5%.

Key Points

The PPI data confirmed the upstream price pressure in the NZ economy related to high prices of oil and other commodities, as well as the weak NZD. The PPI data is consistent with our estimate of Q2 import price inflation in excess of 4% qoq (data to be released on 11 September). Such a figure and the continued NZD decline highlights the significant upside risk to the RBNZ's forecast of -0.6% for import price inflation over the year to March 2001. Upstream price pressures and flow-on effects into the CPI are going to be significantly more problematic than the Bank acknowledged in its latest Policy Statement. Comments by importers and major retail chains about the inability to hold prices in the light of external cost pressure have weakened the argument that soft domestic demand will prevent a major pass-through into the CPI. We continue to forecast annual CPI inflation to reach 3% over the next few quarters and remain above 2% for a prolonged period. It will be a major challenge for the RBNZ to prevent trend inflation from settling above 2% without obstructing the required adjustment of the economy to a lower dollar.

This, along with an extensive range of other publications, is available on our web site http://research.gm.db.com

In order to read our research you will require the Adobe Acrobat Reader which can be obtained from their website http://www.adobe.com for free.

For answers to your EMU questions, check Deutsche Bank's EMU web site http://www.db.com/emu or email our helpline business.emu@db.com.

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half A Billion Accounts: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>

Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>

ALSO:

Half Full: Fonterra Raises Forecast Payout As Global Supply Shrinks

Fonterra Cooperative Group, the dairy processor which will announce annual earnings tomorrow, hiked its forecast payout to farmers by 50 cents per kilogram of milk solids as global supply continues to decline, helping prop up dairy prices. More>>

ALSO:

Results:

Meat Trade: Silver Fern Farms Gets Green Light For Shanghai Maling Deal

The government has given the green light for China's Shanghai Maling Aquarius to acquire half of Silver Fern Farms, New Zealand's biggest meat company, with ministers satisfied it will deliver "substantial and identifiable benefit". More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news