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New Zealand inflation rate slows to 1.7% in Q2

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Staff Writer | July 20, 2017
Consumer prices in New Zealand increased 1.7% year-on-year in the second quarter of 2017, below market expectations of 1.9% and down from 2.2% in the previous period which was the highest in five years.
New Zealand inflation
New Zealand   Consumer prices
The inflation rate eased for the first time in six quarters mainly due to a softer increase in prices of housing, utilities and transport and a steeper decline in cost of communication.

Prices rose at a slower pace for housing and utilities (3.1% from 3.3% in Q1), with purchase of new housing up 6.4% (6.7% in Q1).

Inflation also slowed for transport (1.2% from 3.5% in Q1); miscellaneous goods and services (1.7% from 1.9%); alcoholic beverages and tobacco (3.7% from 3.9%).

In addition, communication prices decreased 4.6% (-3.1% in Q1), with large decreases for telecommunications services and equipment. In contrast, food cost accelerated (2% from 1.6%).

On a quartely basis, consumer prices were flat: food prices rose 0.7%, influenced by higher prices for vegetables (up 19%). Housing and household utilities prices rose 0.8%, influenced by purchase of new housing (up 1.8%).

On the other hand, transport prices fell 1.3%, with cheaper domestic airfares (down 15%).

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