New Zealand 4Q Producer Input Prices +0.5% Vs 3Q
First Published Sunday, 19th February 2012 10:58 pm - © 2012 Dow Jones
--New Zealand fourth-quarter producer output prices +0.1% Vs third quarter
--Weaker NZ dollar contributed to on-quarter rise in input prices
(Adds detail from Statistics New Zealand throughout, comment from economist in the fourth paragraph, background on monetary policy in the fifth paragraph.)
By Rebecca Howard
Of Dow Jones NEWSWIRES
WELLINGTON -(Dow Jones)- Prices for goods and services used by New Zealand producers, or input prices, continued to rise in the fourth quarter of last year while output prices rose to a lesser degree, data that will likely add to the view that the Reserve Bank of New Zealand has plenty of time on its hands before it needs to contemplate a rate hike.
Statistics New Zealand said Monday that input prices, measured by its producer price index, rose 0.5% in the fourth quarter from the third, when they rose 0.6% on the quarter.
Output prices, or prices for goods and services produced in New Zealand, rose 0.1% from the third quarter, when they had risen 0.2%.
The data are "indicative of subdued inflationary pressures and ongoing pressure on producers' margins," UBS Senior Economist for New Zealand Robin Clements said.
The Reserve Bank of New Zealand held its benchmark interest rate unchanged at 2.50% in January, citing ongoing uncertainty around global conditions and the moderate pace of domestic demand. Most economists don't expect the Reserve Bank to raise the rate until the end of this year at the earliest.
Higher prices paid by dairy product manufacturers to farmers made the most significant contribution to the latest increase in the prices paid by producers, Statistics New Zealand said in a release. The most significant downward contribution came from a fall in electricity and gas supply prices.
Statistics New Zealand said the fact the New Zealand dollar was lower against major traded currencies in the fourth quarter also played a part in the on-quarter rise.
Agriculture was the key contributor to the slight rise in output prices, with milk and meat prices up. In the other direction, the most significant downward contribution came from the fall in electricity and gas supply prices.
-By Rebecca Howard, Dow Jones Newswires; +64-4-471-5990; firstname.lastname@example.org