Inflation drops nearer target

The consumers price index (CPI) increased 3.3 per cent in the year to the June 2024 quarter, according to the latest figures from Stats NZ.

It meant inflation had dropped from the four per cent rise in the 12 months to the March 2024 quarter.

Nicola Growden, consumers prices senior manager, says the latest annual price increase is below what was seen during the peak in 2022 and is similar to three years ago.

The Reserve Bank of New Zealand’s target range for consumer inflation is between one and three per cent. 

Housing and household utilities were the largest contributor to the annual inflation rate, due to rising prices for rent, construction of new houses and rates.

Prices for insurance increased 14 per cent in the year to the June quarter, mirroring the annual rise to the March quarter.

Growden says the increase was nearly double what was recorded in June 2009, which was the previous highest peak in the series.

“Increases in dwelling and vehicle insurance premiums largely drove the higher insurance prices,” she adds.

On a quarterly basis, the CPI rose by 0.4 per cent in the June 2024 period.

A breakdown of the Stats NZ data shows prices for the transport group dropped 0.5 per cent quarter-on-quarter. 

This included the purchase of vehicles falling 2.3 per cent and passenger transport services decreasing by 3.3 per cent.

Inflation for the transport group came in at 3.5 per cent in the 12 months to the March 2024 quarter, with vehicle purchase prices falling by three per cent.