6401.0 - Consumer Price Index, Australia, Mar 2014 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 23/04/2014   
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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). Unless otherwise stated, the analysis uses original, not seasonally adjusted, estimates.

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



ALCOHOL AND TOBACCO GROUP (+2.9%)

The alcohol and tobacco group rose in the March quarter 2014. The main contributor to the rise was tobacco (+6.7%). The tobacco price increase was caused by the federal excise tax rise from 1 December 2013 as well as the March 2014 biannual indexation based on the ABS's Average Weekly Ordinary Times Earnings (AWOTE) rate.

Over the twelve months to the March quarter 2014, the alcohol and tobacco group rose 6.8%. The main contributor to the rise was tobacco (+13.8%).


EDUCATION GROUP (+5.1%)

The education group rose in the March quarter 2014, with the commencement of the new school year. Rises in secondary education (+6.0%), tertiary education (+4.3%) and preschool and primary education (+4.9%) drove this movement.

Over the twelve months to the March quarter 2014, the education group rose 5.1%.


HEALTH GROUP (+2.6%)

The health group rose in the March quarter 2014 with all capital cities registering a rise. The main contributors to the rise were medical and hospital services (+1.9%) and pharmaceutical products (+6.1%). These rises were a result of the cyclical reduction in the proportion of patients who qualify for subsidies under the Medicare Benefits Scheme and Pharmaceutical Benefits Scheme at the start of each calendar year.

Over the twelve months to the March quarter 2014, the health group rose 4.0%. The main contributor to the rise was medical and hospital services (+5.4%).


HOUSING GROUP (+0.6%)

The housing group rose in the March quarter 2014. The main contributors to the rise were electricity (+1.4%) and rents (+0.7%).

Over the twelve months to the March quarter 2014, the housing group rose 3.6%. The main contributors to the rise were new dwelling purchase by owner-occupiers (+2.4%), rents (+2.9%), and electricity (+5.2%).


FURNISHINGS, HOUSEHOLD EQUIPMENT AND SERVICES GROUP (-1.5%)

The furnishings, household equipment and services group fell in the March quarter 2014. The main contributors to the fall were furniture (-4.3%) and personal care products (-1.9%).

Over the twelve months to the March quarter 2014, the furnishings, household equipment and services group rose 0.9%. The main contributor to the rise was child care (+7.3%).


TRANSPORT GROUP (+1.1%)

There was a rise for the transport group in the March quarter 2014 due to increases in automotive fuel (+4.0%).

Automotive fuel fell in November (-1.9%), rose in December (+5.5%) and January (+1.2%), fell in February (-0.2%) and was flat in March (0.0%).

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: TRANSPORT GROUP (+1.1%)

Over the twelve months to the March quarter 2014, the transport group rose 2.5%. The main contributor to the rise was automotive fuel (+7.4%).


CLOTHING AND FOOTWEAR GROUP (-2.1%)

The clothing and footwear group fell in the March quarter 2014, mainly due to post-Christmas sales. The main contributors to the movement were garments for men (-2.9%), accessories (-2.2%) and garments for women (-1.2%).

Over the twelve months to the March quarter 2014, the clothing and footwear group increased 0.5%. The main contributor to the movement was garments for men (+4.4%). This was partially offset by a fall in garments for women (-1.7%).


RECREATION AND CULTURE GROUP (-0.5%)

The recreation and culture group fell in the March quarter 2014, mainly due to price decreases in international holiday travel and accommodation (-2.4%) and domestic holiday travel and accommodation (-2.4%). The fall was partially offset by rises in other recreational, sporting and cultural services (+3.1%).

Over the twelve months to the March quarter 2014, the recreation and culture group rose 2.7%.

In the CPI, airfares are collected in advance (at the time of payment), but are only used in the CPI in the quarter in which the trip is undertaken. International airfares are collected two months in advance (January for travel in March) and domestic airfares are collected one month in advance (January for travel in February).


FOOD AND NON-ALCOHOLIC BEVERAGES GROUP (+0.3%)

The food and non-alcoholic beverages group rose in the March quarter 2014. The main contributor to the rise was vegetables (+3.3%). The rise was partially offset by a fall in fruit (-2.5%).

Over the twelve months to the March quarter 2014, the food and non-alcoholic beverages group rose 2.2%. The main contributors to the rise were vegetables (+9.2%), fruit (+5.0%), take away and fast foods (+1.9%) and restaurant meals (+1.7%). The rise was partially offset by falls in coffee, tea and cocoa (-3.3%) and lamb and goat (-1.5%).


INSURANCE AND FINANCIAL SERVICES GROUP (+0.4%)

The insurance and financial services group rose in the March quarter 2014. The main contributor to the rise was other financial services (+0.4%).

Over the twelve months to the March quarter 2014, the insurance and financial services group rose 1.3%. The main contributor to the rise was other financial services (+2.6%).


COMMUNICATION GROUP (+0.2%)

The communication group rose in the March quarter 2014 due to a rise in the price of postal services (+7.0%).

Over the twelve months to the March quarter 2014, the communication group rose 1.9%. The main contributor to the rise was telecommunication equipment and services (+1.6%).


INTERNATIONAL TRADE EXPOSURE - TRADABLES AND NON-TRADABLES

The tradables component (see Table 8) of the All groups CPI rose 0.4% in the March quarter 2014. Prices for the goods and services in this component, representing approximately 40% of the CPI, are largely determined on the world market. The most significant contributors to the 0.6% rise in the tradable goods component were tobacco, automotive fuel and pharmaceutical products. The most significant offsetting fall in the tradable goods component was for furniture. The fall in the tradable services component of 2.4% was driven by international holiday travel and accommodation.

The non-tradables component of the All groups CPI rose 0.7% in the March quarter 2014. Prices for the goods and services in this component, which represent approximately 60% of the CPI, are largely determined by domestic price pressures. The non-tradable goods component rose 0.6% mainly due to electricity. The non-tradables services component rose 0.8% mainly due to rises in secondary education, tertiary education and medical and hospital services. The most significant offsetting falls in the non-tradable services component were in maintenance and repair of motor vehicles and domestic holiday travel and accommodation.

Over the twelve months to the March quarter 2014, the tradables component rose 2.6%, while the non-tradables component rose 3.1%. This compares to the rises of 1.0% and 3.7% respectively through the year to the December quarter 2013.

A detailed description of which expenditure classes are classified as tradable and non-tradable in the 16th series is shown in Appendix 1 of the September quarter 2011 issue of Consumer Price Index, Australia (cat. no 6401.0).


SEASONALLY ADJUSTED ANALYTICAL SERIES

In the March quarter 2014 the All groups CPI seasonally adjusted rose 0.5%, compared to the unadjusted All groups CPI which rose 0.6%.

The trimmed mean rose 0.5% in the March quarter 2014, compared to a rise of 0.9% in the December quarter 2013. Over the twelve months to the March quarter 2014, the trimmed mean rose 2.6%, compared to a rise of 2.6% over the twelve months to the December quarter 2013.

The weighted median rose 0.6% in the March quarter 2014, compared to a rise of 0.9% in the December quarter 2013. Over the twelve months to the March quarter 2014, the weighted median rose 2.7% compared to a revised rise of 2.5% over the twelve months to the December quarter 2013.

A detailed explanation of the seasonal adjustment of the All Groups CPI is available in Information Paper: Seasonal Adjustment of Consumer Price Indexes, 2011 (cat. no. 6401.0.55.003) available on the ABS website. This paper includes a description of the seasonal adjustment methodology used to calculate the trimmed mean and weighted median measures of underlying inflation.

Revisions to the seasonally adjusted estimates can be the result of the application of concurrent seasonal adjustment, described in paragraph 15 of the Explanatory Notes.