6401.0 - Consumer Price Index, Australia, Jun 2009 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 22/07/2009   
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MAIN CONTRIBUTORS TO CHANGE


CPI GROUPS

The discussion of the CPI groups below is ordered in terms of their absolute significance to the change in All groups index points for the quarter (see tables 6 and 7).

Weighted average of eight capital cities, Percentage change from previous quarter
Graph: Weighted average of eight capital cities, Percentage change from previous quarter



TRANSPORTATION (+1.6%)

The main contributor to the increase in transportation costs this quarter was the rise in the price of automotive fuel (+3.6%). This was compounded by a rise in motor vehicles of 0.9%. Motor vehicle parts and accessories and motor vehicle repair and servicing rose 1.6% and 0.9% respectively. Other motoring charges and urban transport fares recorded no change.

Automotive fuel prices rose in January (+2.5%) and February (+11.4%), fell in March (-3.7%), rose in April (+1.2%), fell in May (-0.2%) and rose again in June (+4.7%).

The following graph shows the pattern of the average daily prices for unleaded petrol for the eight capital cities over the last fifteen months.

Diagram: TRANSPORTATION (+1.6%)

Over the twelve months to June quarter 2009, the transportation group fell 5.9%, with the main contributors being automotive fuel (-20.6%) and motor vehicles (-0.9%). Motor vehicle parts and accessories (+8.8%), urban transport fares (+5.1%), motor vehicle repair and servicing (+4.2%) and other motoring charges (+3.9%) provided some offsetting increases.


HOUSEHOLD CONTENTS AND SERVICES (+2.2%)

Eleven of thirteen categories in the household contents and services group recorded rises this quarter. The most significant contributors were furniture (+3.7%), other household supplies (+2.0%) and glassware, tableware and household utensils (+5.5%). Off-setting decreases came from major household appliances (-0.7%) and from household cleaning agents (-0.6%).

The increases in furniture and in glassware, tableware and household utensils were largely due to rises in the wake of specials offered in March quarter 2009.

Over the twelve months to June quarter 2009, the household contents and services group rose 2.4%, with positive movements in all capital cities. The increase was predominantly due to rises in other household supplies (+5.1%), furniture (+3.0%), floor and window coverings (+5.6%) and other household services (+5.5%). Child care (-18.7%) recorded the largest annual negative movement due to an increase in the child care tax rebate which was implemented in September quarter 2008.


HOUSING (+0.8%)

Most categories of housing recorded price rises this quarter. Rents (+1.4%), house purchase (+0.8%) and house repairs and maintenance (+1.2%) were the main contributors to the increase. House purchase now shows the full impact of the increase to the First Home Owner Boost, partially measured in the March quarter 2009, plus a number of state government incentives. The only offsetting price fall was in electricity (-0.6%) due to seasonal pricing in Melbourne and Adelaide.

Average rents rose in every capital city, ranging from 2.2% in Darwin to 0.9% in Canberra.

Over the twelve months to June quarter 2009, the housing group rose 5.2% mainly due to rents (+7.2%), electricity (+8.5%) and house purchase (+1.8%).


FOOD (-0.9%)

The food group fell in all capital cities during this quarter. The most significant contributors were vegetables (-6.9%) and fruit (-7.6%), both of which benefited from peak growing seasons and favourable weather patterns. Removal of a tax on milk contributed to a 3.0% fall in milk prices. Off-setting price rises came from take away and fast foods (+1.1%) and from restaurant meals (+0.8%).

Over the twelve months to June quarter 2009, twenty three of the twenty six food categories rose to create a 4.8% rise across the food group. Increases occurred in all capital cities, mainly driven by general price rises in take away and fast foods (+5.7%), restaurant meals (+4.1%) and fruit (+7.7%).


FINANCIAL AND INSURANCE SERVICES (-1.7%)

The major contributor to the decrease in financial and insurance services this quarter was deposit and loan facilities (-4.3%). Other financial services (+0.1%) and insurance services (+1.3%) provided offsetting increases.

There was a fall in the price of services charged by financial institutions which includes prices derived from interest-rate margins. The impact on prices varied across the range of products covered in the CPI. The ABS continues to review the outlets, products and their weights in the CPI basket to ensure they are representative and contemporary. This quarter some improvements have been incorporated in the measurement of deposits and loan facilities in response to changes observed in the economy over the last twelve months.

Over the twelve months to June quarter 2009, the financial and insurance services group fell 6.6%, driven by a 17.9% fall in deposit and loan facilities. This was offset by increases in insurance services (+9.0%) and other financial services (+2.6%).


HEALTH (+2.3%)

The major contributors to the rise in health costs this quarter were hospital and medical services (+3.6%) and dental services (+0.8%). Pharmaceuticals (-0.6%) provided the only offsetting fall.

Hospital and medical services rose mainly as a result of increases in private health fund premiums from 1 April 2009.

Over the twelve months to June quarter 2009, the health group rose 5.2% due to increases in hospital and medical services (+6.4%), dental services (+4.2%) and pharmaceuticals (+2.9%).


CLOTHING AND FOOTWEAR (+2.1%)

The rise in clothing and footwear prices this quarter was due to increases in accessories (+6.3%), women's underwear, nightwear and hosiery (+9.4%), children's and infants' clothing (+3.1%) and men's outerwear (+3.0%). These increases were due to cessation of last quarter's specials and price rises for new season stock. Women's footwear (-2.0%) and men's footwear (-1.8%) provided the major offsetting decreases displaying falls in most capital cities.

Over the twelve months to June quarter 2009, the clothing and footwear index rose 1.3%. The increase was mainly due to increases in women's underwear, nightwear, hosiery (+9.7%), accessories (+7.1%) and clothing services and shoe repairs (+3.9%). Women's footwear (-4.8%) provided the major offsetting fall.


ALCOHOL AND TOBACCO (+0.9%)

The alcohol and tobacco group recorded a rise of 0.9% in the June quarter 2009.

There were price rises in tobacco (+1.2%), beer (+1.2%) and spirits (+0.8%). Wine (-0.1%) provided a small offsetting fall.

Over the twelve months to June quarter 2009, the alcohol and tobacco group rose 4.7%.


COMMUNICATION (+0.3%)

The rise in communication costs this quarter was due to increases in the cost of telecommunication (+0.2%). Postal services (0.0%) recorded no change.

Over the twelve months to June quarter 2009, the communication group rose 1.2%.


EDUCATION (+0.1%)

The education group reported a slight rise in the June quarter 2009. Most educational institutions commonly report changes to fees during the March quarter, however this quarter a small increase was seen in preschool and primary education (+0.4%).

Over the twelve months to June quarter 2009, the education group rose 5.1%.


RECREATION (-0.1%)

The fall in recreation this quarter was mainly due to price decreases for overseas holiday travel and accommodation (-3.4%) and audio, visual, media and services (-1.6%). The major offsets were provided by pets, pet food and supplies (+5.0%) and domestic holiday travel and accommodation (+1.0%).

Over the twelve months to June quarter 2009, the recreation group rose 0.7%. This rise was mainly due to pets, pet food and supplies (+9.9%) and other recreation activities (+4.8%). Audio, visual and computing equipment (-10.1%) provided the major offset.


TRADABLES AND NON-TRADABLES

The tradables component (see table 8) of the All groups CPI rose 0.7% in the June quarter 2009. Prices for the goods and services in this component are largely determined on the world market. The tradables component represents approximately 42% of the weight of the CPI. The rise in the tradable goods component was driven by increases in automotive fuel, furniture, motor vehicles, accessories and other household supplies. The most significant offsetting fall was in vegetables. The only tradable services component, overseas holiday travel and accommodation, fell 3.4%.

The non-tradables component of the All groups CPI rose 0.4% in the June quarter 2009. Prices for the goods and services in this component are largely determined by domestic price pressures. The non-tradables component represents approximately 58% of the CPI. Within non-tradables, the services component rose 0.4%, due to hospital and medical services, rents and domestic holiday travel and accommodation. The most significant offsetting movement was deposit and loan facilities. The non-tradable goods component rose 0.3% mainly due to price increases for house purchase, take away and fast foods and beer.

Through the year to June quarter 2009, non-tradables rose 2.4% and tradables showed zero percentage change. This compares to non-tradables rising 3.4% and tradables rising 0.8%, respectively, for these components through the year to March quarter 2009. The main drivers in non-tradables were rents, hospital and medical services, take away and fast foods, electricity and house purchases. The largest offsetting movement was in deposit and loan facilities. Tobacco, spirits, fruit and other household supplies were the main contributors to the rise in tradables with the decrease in automotive fuel offering a partial offset.