Construction Drives Capital Goods Price Rise

Capital Goods Price Index: June 2005 quarter

22 August 2005

Construction Drives Capital Goods Price Rise

Capital goods prices rose 1.0 percent in the June 2005 quarter compared with the March 2005 quarter, Statistics New Zealand said today. On an annual basis, the Capital Goods Price Index (CGPI) increased 3.0 percent. Higher prices for construction components were seen by respondents as the dominant driver for the price changes recorded this quarter for both the residential and non-residential buildings indexes.

The residential buildings index, consistently the most significant positive contributor to the CGPI in recent times, rose 2.2 percent in the June 2005 quarter. Another significant upward contribution came from the non-residential buildings index, which increased 1.2 percent.

The plant, machinery and equipment index increased 0.1 percent in the June 2005 quarter, its first quarterly increase since the December 2001 quarter. Despite the strengthening New Zealand dollar during the June 2005 quarter, 19 of the 32 asset type indexes within the overall plant, machinery and equipment asset group recorded price increases. Respondents cited higher prices for raw materials as the main reason for price increases in this quarter.

The transport equipment index decreased 1.0 percent in the June 2005 quarter. In 10 out of the last 11 quarters, the transport equipment index has recorded falls. The index is now 4.7 percent lower than in the September 2002 quarter.

Brian Pink
Government Statistician

ENDS

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