Synopsis
In the fourth quarter of 2024, New Zealand's Consumers Price Index (CPI) experienced a year-on-year rise of 2.2 percent, reflecting a slower rate of inflation compared to previous quarters. Key contributors include rent prices and local authority rates, while petrol price declines helped mitigate overall inflation.Key Takeaways
- New Zealand's CPI increased by 2.2 percent year-on-year.
- Annual inflation remains within the 1 to 3 percent target band.
- Rent prices were the largest contributor to inflation.
- Petrol prices fell by 9.2 percent, offsetting inflation.
- Quarterly CPI rose 0.5 percent in Q4 2024.
Wellington, Jan 22 (NationPress) New Zealand's Consumers Price Index (CPI) rose by 2.2 percent year-on-year in the fourth quarter of 2024, matching the 2.2 percent annual increase observed in the third quarter of 2024. This trend reflects a deceleration in price growth, as reported by the statistics department Stats NZ on Wednesday.
According to Stats NZ prices and deflators spokesperson Nicola Growden, prices continue to rise, but at a reduced pace compared to previous figures. The highest inflation rate was recorded in the second quarter of 2022, reaching 7.3 percent.
Growden noted, “This marks the second consecutive quarter where the annual inflation rate remains within the Reserve Bank of New Zealand's target band of 1 to 3 percent, after a prolonged period of exceeding this range from the second quarter of 2021 through the second quarter of 2024.
Approximately 20 percent of the 2.2 percent annual increase in the CPI can be attributed to rising rent prices, which saw an increase of 4.2 percent, making it the most significant contributor to annual inflation. Annual rent inflation fluctuated between 4.2 percent and 4.8 percent from the fourth quarter of 2023 to the fourth quarter of 2024, maintaining a steady growth pattern.
Additionally, the 2.2 percent annual inflation increase included a 16 percent contribution from local authority rates and payments, which surged by 12.2 percent in the year leading up to the fourth quarter of 2024, as per statistics.
Prices for cigarettes and tobacco accounted for 11 percent of the 2.2 percent annual CPI rise, reflecting a 7.6 percent increase over the last year, primarily due to the annual tobacco excise tax hike on January 1, 2024, as reported by Xinhua news agency.
Despite the uptick in inflation, this was tempered by a 9.2 percent decline in petrol prices, influenced partly by the removal of the Auckland regional fuel tax of 10 cents per litre on June 30, 2024. Petrol constitutes about 4 percent of the CPI basket.
Growden added, “Excluding petrol, the CPI would have risen by 2.7 percent in the 12 months leading to December 2024.” The decrease in vegetable prices, down 14.6 percent, also contributed to offsetting the annual CPI increase.
On a quarterly basis, the CPI climbed 0.5 percent in the fourth quarter of 2024 compared to the previous quarter, primarily driven by a 6.6 percent rise in international air transport prices, according to Stats NZ.
