New Zealand consumer prices tumbled in the March quarter, recording a decline of 0.3%.
The figure, following a 0.2% drop in the December quarter of 2014, was below market expectations for a decline of 0.2% and was the first back-to-back quarterly contraction seen in 16 years.
Reflective of the quarterly performance, the annual rate slipped to just 0.1%, the slowest rate recorded since the September quarter 1999.
Tradable prices, those goods and services subject to foreign competition, fell by 2.8% on year, overriding a 2.3% increase in non-tradable prices.
Breaking that down into even simpler form Statistics New Zealand had this to say:
“The fall in the March quarter CPI, which last happened in 2001, was caused by an 11 percent fall in petrol prices. Without petrol, the CPI rose 0.3 percent”.
That is, without petrol, inflation rose by 0.3% during the quarter, and by 1.0% on year.
While the New Zealand Dollar outperformed the Australian Dollar over the March quarter, something that may lessen tradable deflation in Australia’s CPI release due on Wednesday, it appears risks heading into this event may be to the downside.