New Zealand consumer price inflation (CPI) rose by 0.2% in the first three months of 2016, according to data released by Statistics New Zealand (SNZ) today.
The increase, above the 0.1% gain expected, was also higher than the 0.5% decline registered in the December quarter of 2015.
As a result of the upside quarterly beat, the annual rate rose to 0.4%, in line with expectations. It was also higher than the 0.1% increase registered in the 12 months to December 2015.
Non-tradable (domestic) inflation rose by 1.6% from 12 months earlier, largely mitigating a 1.2% decline in tradable inflation.
According to Statistics New Zealand, higher prices for cigarettes, food, and housing-related costs were partially offset by lower prices for petrol and air fares.
“Cigarette and tobacco prices showed the highest upward contribution, up 9.4% in the March 2016 quarter following a rise in excise duty in January,” said Matt Haigh, consumer prices manager at SNZ.
“The average price of a pack of 25 cigarettes was $NZ28.79 in the March 2016 quarter, more than double the price from six years ago when annual 10% excise tax increases were introduced.”
Excluding the sharp rise in cigarette and tobacco prices, CPI fell 0.1% for the quarter, led by a steep decline in petrol prices.
The chart below, supplied by SNZ, reveals the quarterly contribution by category to the final CPI reading.
On the back of the small quarterly increase, the New Zealand dollar has trimmed its early session losses, trading at .6904 against the US dollar.