Producer Price Index QoQ

New Zealand Producer Price Index (PPI) QoQ, from Stats NZ (Statistics New Zealand), tracks prices of non-household producers. QoQ means quarter-on-quarter, the percent change versus the prior March, June, September or December quarter. The outputs index measures prices received for goods, services, rents and leases that generate operating income. The inputs index measures prices paid for intermediate consumption, excluding capital, labour, taxes and financing, unlike the consumers price index (CPI) of household consumption.

Most prices come from the quarterly Commodity Price Survey for the 15th of the middle month; volatile items are averaged and missing prices imputed. Foreign-currency quotes use the mid-quarter bank selling rate for that date. It is released in the third week of the second month after the quarter, about 7 weeks after quarter end. Release is at 10:45am New Zealand time, with no pre-release access and a morning media conference.

Each Business Price Indexes issue adds commentary, tables, graphs and custom indexes on request. Results are final on publication and change only for errors of 3 or more index points, marked with R.

Moves reflect broad output prices received and input costs paid across industries.

• Outputs, all industries: captures sales of primary products, manufactured goods, rents, leases and services.
• Inputs, all industries: captures materials, fuels, electricity, transport, communication, commission, contract and business services, rents, insurance and finance costs. It generally excludes GST (goods and services tax).

The December 2022 quarter published February 21, 2023 showed outputs up 0.9% and inputs 0.5%, with farm expenses up 2.6% and capital goods up 2.1%. Annual gains reached 7.7% for outputs and 8.0% for inputs, cooling from 8.4% annual and 1.6% quarterly growth the quarter before. For outputs, transport rose 8.6%, finance 4.6% and building construction 2.0%; for inputs, construction rose 1.6%, equipment manufacturing 11.4% and owner housing 3.5%. The gap shows margin relief, yet equipment input costs of 11.4% dwarfed the 0.5% all-industry input rise.

1. Fixed basket: Quantities come from the weight reference year and weights are updated each March quarter. Fixed weights assume inelastic demand, eased by yearly reweighting. It is a Lowe variant of Laspeyres, with price-updated weights.
2. Price reference: Current prices are compared against the December quarter of the prior year.
3. Index formula: Each item price relative is weighted by revenue or cost share, summed and multiplied by 1000. December 2010 equals 1000 without changing percent changes.
4. Illustrative example: Publisher basket holds 2500 units at $1 and 1500 units at $5, giving weights 0.25 and 0.75. Prices of $2 and $6 give an index of 1400, while $2 and $5 give 1250.
5. Quarterly change and quality: QoQ percent equals current index over prior index minus 1, times 100. There is no seasonal adjustment; quality and sample shifts are linked so only price moves show.