FINANCIAL ANALYSIS

Financial Analysis

Financial Analysis

New Zealand Inflation Rate

In mainstream economics, the word “inflation” refers to a general rise in prices measured against a standard level of purchasing power. Previously the term was used to refer to an increase in the money supply, which is now referred to as expansionary monetary policy or monetary inflation. Inflation is measured by comparing two sets of goods at two points in time, and computing the increase in cost not reflected by an increase in quality. There are, therefore, many measures of inflation depending on the specific circumstances.

The inflation rate in New Zealand was 2.00 percent in December of 2009. Inflation rate refers to a general rise in prices measured against a standard level of purchasing power. The most well known measures of Inflation are the CPI which measures consumer prices, and the GDP deflator, which measures inflation in the whole of the domestic economy. This page includes: New Zealand Inflation Rate chart, historical data and news.( James, 2009)

YearJanFebMarAprMayJunJulAugSepOctNovDec

2009 2.00 3.00 1.90 1.70

2008 3.40 3.40 4.00 5.10

2007 3.20 2.50 2.00 1.80

New Zealand's Inflation Rate Accelerates to 1.3%

New Zealand inflation accelerated faster than economists forecast in the third quarter, adding to signs that central bank Governor Alan Bollard may have to raise interest rates earlier than he predicted last month.

Consumer prices rose 1.3 percent from the second quarter, Statistics New Zealand said. Prices gained 1.7 percent from a year earlier.( James, 2009)

House prices rose 1.9 percent in September from August, the Real Estate Institute said yesterday. Consumer confidence rose to a four-year high in the third quarter, Westpac said in a report last month. Business confidence surged to a 10-year high in September, according to a survey by ANZ National Bank Ltd.

The central bank is required to keep annual inflation between 1 percent and 3 percent on average. At 1.7 percent, annual inflation is the lowest since the first quarter of 2004, today's report showed.

Annual inflation slowed from 1.9 percent in the year to June because third-quarter inflation was less than the 1.5 percent pace in the year-earlier quarter.

Bollard expects annual inflation will be at or below 2 percent until early 2011, according to forecasts in last month's monetary policy statement. He predicted consumer prices rose 0.9 percent in the third quarter.

Bollard's primary focus is on non-tradable inflation, a core measure of prices that are not influenced by currency fluctuations and fuel.

Non-tradable prices rose 1 percent from the second quarter, today's report showed. The measure gained 3 percent from a year earlier, the smallest gain in more than seven years.( Davis, 2008)

New Zealand Growth Rate

Economic growth is the increase in value of the goods and services produced by an economy. It is conventionally measured as the percent rate of increase in real gross domestic product, or GDP. Growth is usually calculated in real terms, i.e. inflation-adjusted terms, in order to net out the effect of inflation on the price of the goods and services ...