New stats show household inflation rate is falling

Author: NZ Herald ,
Publish Date: Fri, 3 Feb 2023, 1:10pm

Kiwis were paying slightly more for household goods at the tail-end of 2022 but inflation cooled significantly from the September quarter.

Inflation for all households was up 1.6 per cent in the December quarter, compared with the September quarter.

Back in the September quarter, household inflation was a hefty 2.1 per cent.

In the December quarter, there was minimal variation between different demographic groups but superannuitants experienced slightly lower inflation than others at 1.4 per cent.

Although inflation in the December quarter was less dramatic than the prior three-month period, the new stats also revealed annual inflation rates for households.

Year-on-year, household living-costs price index (HLPI) inflation for all households was 8.2 per cent.

For beneficiaries, it was 6.9 per cent and for superannuitants, annual inflation was 7.4 per cent.

For Māori, it was 8.1 per cent.

Stats NZ released the HLPI data this morning.

The data emerged just a day after signs the labour crisis might finally be easing, with unemployment rising slightly in the fourth quarter of 2022.

And it also emerged ahead of an expected Reserve Bank official cash rate hike later this month.

The Act party said the main contributor to the 8.2 per cent year-on-year jump in household living costs was increasing interest rates.

Party leader David Seymour said Reserve Bank Governor Adrian Orr and Finance Minister Grant Roberston weren’t doing a good enough job.

“The fault belongs to the Government and Adrian Orr. The Government binged on cheap credit from Orr’s low interest rates. Now mortgagees are suffering the hangover,” Seymour said.

He said Robertson must act to reduce the cost of living pressure on Kiwi households.

“The first thing is reducing his Government’s spending that is fuelling inflation and interest rates, and the second thing is providing Kiwis with some much needed tax relief.”

The HLPI measures how inflation affects various household groups. It covers costs including mortgage interest payments on owner-occupied housing.