Big spenders face lowest inflation, beneficiaries the highest

4 May 2017

Beneficiaries experienced the highest inflation in the March 2017 quarter, Stats NZ said today. Their overall costs rose 1.4 percent, almost three times the rate of inflation experienced by the biggest spenders group (up 0.5 percent).

"Higher costs for cigarettes and tobacco had a greater effect on beneficiaries. About 5 percent of their spending went up in smoke, proportionally more than most other types of households spent," consumer prices acting manager Nicola Growden said.

Higher rents, which make up one-third of their total spending, also had a greater effect on beneficiaries.

Inflation for households with high spending rose the least (up 0.5 percent), with the biggest impact coming from higher petrol prices. The fall in international air fares and mortgage interest rates in the quarter dampened overall inflation rise of high-spending households.

Highest annual inflation seen in lowest-spending households

Living costs for low-spending households faced the highest inflation over the past year, up 2.3 percent. This is the highest annual inflation for this group since the June 2014 quarter. Price increases for petrol and rent have had a greater impact on this group's spending.

Inflation for Māori households was up 2.1 percent, with higher prices for petrol, cigarettes and tobacco, and housing rentals.

High-spending households experienced lower inflation, up 1.6 percent. Increases in petrol and cigarettes and tobacco prices had a smaller impact on this group's overall inflation compared with other groups. High-spending households spent proportionally less on these items relative to their overall spending compared with other groups. Prices decreased for package holidays and international air fares, for which high-spending households have more discretionary spending.

Difference between the HLPIs and the CPI

The household living-costs price indexes (HLPIs) look at typical inflation experienced by 13 different groups, including beneficiaries, Māori, superannuitants, and 10 other groups of people who have varying income and spending patterns. The CPI is a national average measure of price change that New Zealand households experience.

For more information about these statistics:

• Visit Household Living-costs Price Indexes: March 2017 quarter

• See CSV files for download

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