Stats NZ Refines New Inflation Measure
March 14, 2016 New Zealand Finance
Statistics New Zealand is stepping closer to a new method of calculating inflation, having decided on the treatment of debts, second hand goods, and how different income groups will be grouped.
Late last week Statistics New Zealand issued a statement confirming that it has made some decisions on the process which will be used to calculate “household living-cost price indexes” (HLPI), a new alternative for the calculation of inflation in New Zealand.
The decisions have come following a round of public consultation on methodologies to create a method of calculating inflation more accurately in New Zealand.
When then HLPIs begin to be constructed later in 2016 they will be based on spending an expenditure of different income groups, namely, suppernnuitants, Maori, beneficiaries, and five separate income groups.
It was also confirmed that all forms of consumer debts will be included in the calculation of the HLPIs, including housing debt, loans, and hire purchases.
It was also confirmed that the purchase of second hand goods will be included in the calculation, despite previous concerns that the inclusion could result in “double counting” of the goods.
Photo By: Summer Skyes 11