Consumer Price Index

New Zealand Consumer Price Index (CPI) measures price change for a fixed, unchanging basket of household goods and services. Stats NZ, the national statistics agency, has run it since 1914 and publishes all-groups results each quarter from 1924.

It reflects spending of private households in permanent homes, about 98% of residents, across 11 groups. Collection uses about 100000 prices and about 1700 surveys from over 2800 shops in 12 centres. Food also has a monthly index, and the gauge tracks change only, excludes mortgage interest and is not a cost of living scale.

Prices are collected weekly for fuels and fresh produce, monthly for food and similar items, quarterly for other goods and annually for slow changing items. Stats NZ generally publishes results 12 working days after quarter end at 10:45am New Zealand time, with December often later for holidays. Each release shows quarterly and annual rates, contributions, trimmed means, averages without extremes, with no revisions; results stay final. Traders read tradables, foreign driven prices, for global and currency pressure and non-tradables, domestic driven prices, for local demand pressure.

3 groups dominate the basket, with smaller parts adding insurance, airfares and other services.

• Housing and household utilities, 28.00%: captures new home construction, actual rentals and property rates.

• Food, 18.72%: captures grocery food, meat and fish, plus restaurant meals and ready to eat food.

• Transport, 11.93%: captures vehicle purchases, petrol and diesel, plus passenger transport and airfares.

• Other groups: alcoholic beverages and tobacco, clothing and footwear, household contents and services, recreation and culture, plus miscellaneous goods and services.

In September 2023 quarter (published 17 October 2023), CPI rose 1.8% for the quarter and 5.6% over the year, down from 6.0% to June. Transport led the quarter at 7.1%, housing rose 1.7% with rates up 9.4%, and food added 0.9%. Over the year food reached 8.8%, housing 5.3% and transport 4.6%.

Trimmed means sat at 5.5% to 5.7%, near headline 5.6%, showing persistent pressure, with annual tradables at 4.7% and non-tradables at 6.3%. By December 2023 quarter (published 24 January 2024), quarterly gain slowed to 0.5% and annual to 4.7%, as food fell 1.2% while housing rose 0.8%.

1. Laspeyres index: New Zealand CPI uses a price relative form of Laspeyres, a base weighted gauge, in use since March 1995 quarter. It tracks cost change for the same basket using base period spending shares as weights.

1. Elementary aggregates: Jevons, geometric mean, applies where shoppers can switch outlets, while Dutot, mean price ratio, covers fixed outlet cases. Examples include groceries for Jevons and council rates and doctor fees for Dutot.

1. Monthly to quarterly: monthly outlet averages feed day weighted quarterly regional averages, then national results use regional spending weights. Petrol is sampled weekly, so a mid quarter move splits across 2 quarters.

1. Weights and base: weights stay fixed between reviews every 3 years, when the basket and base reset, with June 2017 quarter equal to 1000. Weights use the acquisitions approach, spending on goods acquired in the weight reference year.

1. Change and contributions: quarterly and annual change comes from index points, basket level units, rounded to 1 decimal place. A contribution blends weight with price move as index points, percentage points or % share, though rounded parts may not sum.

1. Worked example: Food weight 60 at index 1010 and Transport weight 40 at index 1050 give all groups at 1026 from base 1000. Quarterly change is 2.6%, split into 0.6 points from Food and 2.0 points from Transport.

1. Seasonal and quality: headline, all groups, CPI is not seasonally adjusted, regular seasonal moves kept in, though adjusted analytical series exist. About 1 to 2 percent of prices go missing each quarter and carry forward up to 2 periods. Later gaps use mean imputation, average fill, and sale prices count as seen, with size and quality shifts removed to show pure price change.