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

 

NZ Producer Prices (September 2000 Quarter)

Data Flash (New Zealand) NZ Producer Prices (September 2000 Quarter)

Key Points Producer input prices rose 3.8% qoq in Q3 and were 8.0% higher than last year (market expectations: +1.5%).

Producer output prices rose 2.7% qoq and were 5.6% higher than in 1999 (average expectation: +1.2%).

The outturn reflected the direct effect of higher commodity prices (oil and export commodities) and the increasing momentum of flow-on effects into other production sectors. Output prices rose by 7.8% qoq in the agriculture and forestry sector, 3.6% qoq in the manufacturing sector, 3.5% qoq in wholesale trade, 1.5% qoq in retail trade, 1.3% qoq in the transport sector.

Commentary Producer price data continues to confirm significant upstream price pressure in the NZ economy. The correlation between PPIs and the CPI reinforces our view that CPI inflation will rise to nearly 4% by the middle of next year. That projection assumes ongoing pressure on producer margins, which implies that there will be resistance to immediately passing on lower costs once oil prices begin to fall next year and the NZD gains some upward momentum. As a result of the re-building of margins, CPI inflation above 3% is likely to be more persistent than has been suggested by RBNZ projections. That, in turn, raises the risk of second-round effects through higher wage inflation. Our assessment of the inflation outlook relative to the mid-point of the 0-3% target band supports our expectation of further RBNZ tightening steps next year - beginning with a 25 bps increase in the OCR on 15 March.

Ulf Schoefisch, Chief Economist, New Zealand, (64) 9 351 1375

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.


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

'Unprecedented' Conditions: Genesis Coal Burn 5-Yr High

Coal-fired generation from Genesis Energy’s Huntly operations was the highest in more than five years in the December quarter, as a combination of low hydro storage and plant outages were compounded by tight natural gas supplies. More>>

ALSO:

Climate Summary: NZ’s Equal-2nd Warmest Year On Record

Annual temperatures were above average (+0.51°C to +1.20°C above the annual average) across the majority of New Zealand... 2018 was the equal 2nd-warmest year on record for New Zealand, based on NIWA’s seven-station series which began in 1909. More>>

ALSO:

GDP: Economic Growth Dampens In The September Quarter

Gross domestic product (GDP) rose 0.3 percent in the September 2018 quarter, down from 1.0 percent in the previous quarter, Stats NZ said today... GDP per capita was flat in the September 2018 quarter, following an increase of 0.5 percent in the June 2018 quarter. More>>

ALSO:

Up $1.20: $17.70 Minimum Wage For 2019

Coalition Government signals how it will move toward its goal of a $20 p/h minimum wage by 2021... “Today we are announcing that the minimum wage will increase to $17.70 an hour on 1 April 2019." More>>

ALSO: