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

 


NZ consumer prices unexpectedly rise in December quarter

NZ consumer prices unexpectedly rise in December quarter on more expensive airfares, housing

By Paul McBeth

Jan. 21 (BusinessDesk) - New Zealand inflation unexpectedly edged higher in the final three months of 2013, led by more expensive airfares, housing and dairy prices.

The consumers price index increased 0.1 percent in the three months ended Dec. 31, slowing from a quarterly increase of 0.9 percent, according to Statistics New Zealand. That was against a forecast decline of 0.1 percent in a Reuters survey of economists and the Reserve Bank’s expectation of a 0.2 percent fall. The annual pace of inflation was 1.6 percent, its fastest pace since March 2012 and slightly ahead of forecasts.

The increase was underpinned by a 12 percent rise in the price of international airfares, the biggest quarterly gain in four years, and a 6.7 percent increase in domestic flights.

“International airfares usually rise in December quarters,” prices manager Chris Pike said in a statement. “This quarter’s rise reflects seasonally higher air fares to Asia and Europe.”

Prices for housing and household utilities rose 0.5 percent with a 1.1 percent rise in the cost of new housing and a 1.6 percent increase in property maintenance services. Prices for milk cheese and eggs advanced 4.2 percent in the quarter.

Those were offset by a 20 percent drop in the price of vegetables and a 3.5 percent decline in the price of petrol.

Investors were awaiting the release of today’s data with the Reserve Bank scheduled to review monetary policy next week. Governor Graeme Wheeler had previously indicated he will start hiking the 2.5 percent official cash rate this year to head off the threat of future inflation as the Auckland and Christchurch property markets continue to bubble and as the Canterbury rebuild gathers momentum.

Before the release, traders were betting the Reserve Bank will hike interest rates by 109 basis points over the coming year, according to the Overnight Index Swap curve, and economists had been pencilling in March as the likely date for Wheeler to start tightening policy.

Tradable inflation, which includes goods and services facing international competition, shrank 0.5 percent for an annual decline of 0.3 percent. Non-tradable inflation rose a quarterly 0.5 percent for an annual pace of 2.9 percent, its fastest pace since September 2011.

The annual pace of inflation, which stayed in the Reserve Bank’s target band of between 1 percent and 3 percent, was driven by a 3.2 percent increase in housing and household utilities, with a 4.7 percent increase in new housing prices, a 2.1 percent rise in rental prices, 4.3 percent increase in property maintenance, and a 3 percent rise in electricity prices. Petrol prices for an annual 0.9 percent

Prices for clothing and footwear fell an annual 1.4 percent, led by cheaper women’s clothing, clothing accessories and men’s footwear, and 2.8 percent decline in the annual price of communications was led by a 21 percent slide in prices for telecommunication equipment.

The level of discounting in the quarter was unchanged at 15 percent of prices discounted from the September period.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Wine: 20% Of Marlborough Storage Tanks Damaged By Quake

An estimated 20 percent of wine storage tanks in the Marlborough region, the country’s largest wine producing area, have been damaged by the impact of the recent Kaikoura earthquake. More>>

ALSO:

ACC: Levy Recommendations For 2017 – 2019 Period

• For car owners, a 13% reduction in the average Motor Vehicle levy • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy. More>>

Women's Affairs: Government Accepts Recommendations On Pay Equity

The Government will update the Equal Pay Act and amend the Employment Relations Act to implement recommendations of the Joint Working Group on Pay Equity. More>>

ALSO:

Immigration: Increase In Seasonal Workers For RSE

The current cap will be increased by 1,000 from 9,500 to 10,500 RSE workers for the 2016-17 season. Mr Woodhouse says the horticulture and viticulture industry is New Zealand’s fourth largest export industry, producing almost $5 billion in exports. More>>

ALSO:

Hurunui: Crown Irrigation Invests Up To $3.4m In North Canterbury

Crown Irrigation Investments will invest up to $3.4m in the Hurunui Water Project, an irrigation scheme that will be capable of irrigating up to 21,000 hectares on the south side of the Hurunui River in North Canterbury. More>>

ALSO:

Not So Great:Butterfly Eradication Success

The invasive pest great white butterfly has been eradicated from New Zealand in a world-first achievement, Primary Industries Minister Nathan Guy and Conservation Minister Maggie Barry say. More>>

Gordon Campbell: On The Government’s Tax Cuts Fixation

Long before the earthquake hit, the dodginess of the government tax cuts programnme was evident in the language of its packaging. It is being touted as a “tax cuts and family care” package... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news