New Zealand Inflation Jumps to 1.9% on Higher Oil Prices

Consumer prices in New Zealand increased 1.9 percent year-on-year in the third quarter of 2018 following a 1.5 percent increase in the previous quarter. The print came above consensus expectations (1.7 percent) and was the highest rate in four quarters.
Statistics New Zealand | Mario | mario@tradingeconomics.com 10/16/2018 10:24:03 AM
Higher inflation was mainly explained by a 19 percent jump in petrol prices, which also nudged transport prices higher (+5.6 percent vs 2.0 percent in Q2). Also, cost rebounded for recreation & culture (0.4 percent vs -0.6 percent). Meantime, housing and household utilities increased 3.1 percent (the same pace as in Q2) with rises in construction (4.1 percent), rentals (2.3 percent) and local authority rates (5.1 percent). On the other hand, prices slowed for food (0.2 percent vs 0.7 percent), mainly driven by cost of grocery food (0.1 percent vs 0.9 percent), non-alcoholic beverages (2.4 percent vs 3.5 percent); meat, poultry and fish (-0.2 percent vs 0.5 percent) and fruits and vegetables (-5.1 percent vs -5.6 percent).

Meantime, albeit at a slower pace compared to the second quarter’s 5.6 percent increase, alcoholic beverages & tobacco increased 4.7 percent, with cigarettes & tobacco climbing 10.6 percent (vs 10.7 percent), mainly triggered by an increase in excise duties for tobacco and tobacco products.

In addition, prices for communications declined sharply in the third quarter, falling 5.4 percent after a 4.9 percent drop in the previous quarter, with telecommunication equipment prices plunging 16.6 percent (vs -8.8 percent) and telecommunication services falling 3.2 percent (vs -4.1 percent).

On a quarterly basis, consumer prices rose 0.9 percent in the third quarter of 2018, way up from from a 0.4 percent increase recorded in the previous period and also above market expectations of 0.7 percent.

New Zealand Inflation Jumps to 1.9% on Higher Oil Prices