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.

TRANSPORT GROUP (-3.4%)

The main contributor to the fall in the transport group for the March quarter 2015 was automotive fuel (-12.2%). The fall was partially offset by a rise in spare parts and accessories (+2.6%).

Automotive fuel fell in November (-4.2%), December (-8.4%) and January (-11.6%) before rising in February (+5.1%) and March (+10.3%). The decrease in fuel was registered in all fuel types with the quarterly fall the largest since December 2008. World oil prices continue to remain low with the price of crude oil recording a sustained fall between June 2014 and January 2015. Despite increases during the March quarter 2015, domestic fuel prices remain low compared to earlier periods.

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

Over the twelve months to the March quarter 2015, the transport group fell 6.2%. The main contributor to the fall was automotive fuel (-22.5%). This fall is the largest in the history of the automotive fuel series, beginning in September 1973. The fall was partially offset by a rise in other services in respect of motor vehicles (+6.8%).

In seasonally adjusted terms, the transport group fell 3.7% in the March quarter 2015. The main contributor to the fall was automotive fuel (-13.0%).


EDUCATION GROUP (+5.3%)

The main contributor to the rise in the education group for the March quarter 2015 was tertiary education (+5.7%) driven by increases in out of pocket TAFE fees. Secondary education (+4.7%) and preschool and primary education (+5.6%) also increased following the commencement of the new school year.

Over the twelve months to the March quarter 2015, the education group rose 5.4%. The main contributors to the rise were tertiary education (+5.7%) and secondary education (+4.7%).

In seasonally adjusted terms, the education group rose 1.3% in the March quarter 2015. The main contributors to the rise were tertiary education (+2.2%) and secondary education (+0.3%).


HOUSING (+0.8%)

The main contributors to the rise in the housing group for the March quarter 2015 were new dwelling purchase by owner-occupiers (+0.9%) and electricity (+1.9%). The rise was partially offset by a fall in water and sewerage (-0.3%).

Over the twelve months to the March quarter 2015, the housing group rose 2.7%. The main contributors to the rise were new dwelling purchase by owner-occupiers (+4.8%) and rents (+2.1%). The rise was partially offset by a fall in electricity (-3.9%).

In seasonally adjusted terms, the housing group rose 0.8% in the March quarter 2015. The main contributor to the rise was new dwelling purchase by owner-occupiers (+0.9%).


HEALTH GROUP (+2.5%)

The main contributors to the rise in the health group for the March quarter 2015 were medical and hospital services (+2.2%) and pharmaceutical products (+5.7%).

The rise in medical and hospital services was mainly due to the cyclical reduction in the proportion of patients who qualify for subsidies under the Pharmaceuticals Benefit Scheme (PBS) and Medicare Benefit Scheme (MBS) as well as the co-payment indexation for PBS at the start of each calendar year. The safety net threshold amount for both government subsidy schemes are reset on 1 January annually, and the co-payment indexation for PBS is scheduled on the same date.

Over the twelve months to the March quarter 2015, the health group rose 4.4%. The main contributor to the rise was medical and hospital services (+6.5%).

In seasonally adjusted terms, the health group rose 0.6% in the March quarter 2015. The main contributor to the rise was medical and hospital services (+1.1%).


RECREATION AND CULTURE GROUP (+0.7%)

The main contributors to the rise in the recreation and culture group for the March quarter 2015 were domestic holiday travel and accommodation (+3.5%) and other recreation, sporting and culture services (+3.4%). The rise was partially offset by falls in international holiday travel and accommodation (-3.0%) and audio, visual and computing equipment (-2.6%).

Over the twelve months to the March quarter 2015, the recreation and culture group rose 2.0%. The main contributor to the rise was domestic holiday travel and accommodation (+5.2%).

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 (e.g. January for travel in March) and domestic airfares are collected one month in advance (e.g. January for travel in February).

In seasonally adjusted terms, the recreation and culture group rose 1.5% in the March quarter 2015. The main contributor to the rise was domestic holiday travel and accommodation (+4.2%).


ALCOHOL AND TOBACCO GROUP (+0.8%)

The main contributor to the rise in the alcohol and tobacco group for the March quarter 2015 was tobacco (+0.9%). Increases to tobacco prices were due to the biannual indexation based on the ABS Average Weekly Ordinary Time Earnings (AWOTE) rate.

Over the twelve months to the March quarter 2015, the alcohol and tobacco group rose 5.2%. The main contributor to the rise was tobacco (+11.5%).

In seasonally adjusted terms, the alcohol and tobacco group rose 1.1% in the March quarter 2015. The main contributor to the rise was tobacco (+2.1%).


CLOTHING AND FOOTWEAR GROUP (-1.3%)

The main contributor to the fall in the clothing and footwear group for the March quarter 2015 was footwear for women (-5.1%). The fall was partially offset by a rise in accessories (+2.7%).

Over the twelve months to the March quarter 2015, the clothing and footwear group fell 0.7%. The main contributors to the movement were garments for women (-2.6%) and garments for men (-1.9%).

In seasonally adjusted terms the clothing and footwear group rose 0.3% in the March quarter 2015. The main contributors to the rise were accessories (+3.0%) and garments for men (+1.8%).


FURNISHINGS, HOUSEHOLD EQUIPMENT AND SERVICES GROUP (-0.5%)

The main contributor to the fall in the furnishings, household equipment and services group for the March quarter 2015 was furniture (-3.3%).

Over the twelve months to the March quarter 2015, the furnishings, household equipment and services group rose 1.5%. The main contributor to the rise was child care (+8.5%).

In seasonally adjusted terms, the furnishings, household equipment and services group rose 0.7% in the March quarter 2015. The main contributor to the rise was furniture (+1.6%).


COMMUNICATION GROUP (-1.4%)

The main contributor to the fall in the communication group for the March quarter 2015 was telecommunication equipment and services (-1.4%).

Over the twelve months to the March quarter 2015, the communication group fell 4.5%. The main contributor to the fall was telecommunication equipment and services (-4.6%).

The communication group is not seasonally adjusted.


FOOD AND NON-ALCOHOLIC BEVERAGES GROUP (+0.2%)

The main contributors to the rise in the food and non-alcoholic beverages group for the March quarter 2015 were vegetables (+3.1%), other meats (+3.2%) snacks and confectionery (+1.4%) and take away and fast foods (+0.6%). The rise was partially offset by falls in fruit (-8.0%) and bread (-3.2%).

Over the twelve months to the March quarter 2015, the food and non-alcoholic beverages group rose 1.9%. The main contributors to the rise were restaurant meals (+2.4%) and take away and fast foods (+2.1%). The rise was partially offset by a fall in bread (-5.8%).

In seasonally adjusted terms, the food and non-alcoholic beverages group rose 0.4% in the March quarter 2015. The main contributors to the rise were vegetables (+1.6%) and take away and fast foods (+0.6%).


INSURANCE AND FINANCIAL SERVICES GROUP (+0.2%)

The main contributor to the rise in the insurance and financial services group for the March quarter 2015 was insurance (+0.4%).

Over the twelve months to the March quarter 2015, the insurance and financial services group rose 1.8%. The main contributor to this rise was other financial services (+2.3%).

In seasonally adjusted terms, the insurance and financial services group rose 0.1% in the March quarter 2015. The main contributor to the rise was insurance (+0.2%).


INTERNATIONAL TRADE EXPOSURE - TRADABLES AND NON - TRADABLES

The tradables component (see Table 8) of the All groups CPI fell 1.2% in the March quarter 2015. Prices for the goods and services in this component are largely determined on the world market. The tradables component represents approximately 40% of the weight of the CPI. The most significant contributor to the 1.2% fall in tradable goods component was automotive fuel. The most significant offsetting rises in the tradable goods component were pharmaceutical products, vegetables and tobacco. The fall in the tradable services component of 3.0% was driven by international holiday travel and accommodation.

The non-tradables component of the All groups CPI rose 1.0% in the March quarter 2015. Prices for the goods and services in this component are largely determined by domestic price pressures. The non-tradables component represents approximately 60% of the weight of the CPI. The non-tradable goods component rose 0.9% mainly due to new dwelling purchase by owner-occupiers and electricity. The most significant offsetting fall was for bread. The non-tradable services component rose 1.1% mainly due to increases in domestic holidays travel and accommodation, tertiary education and medical and hospital services. The most significant offsetting falls were for telecommunication equipment and services and urban transport fares.

Over the twelve months to the March quarter 2015, the tradables component fell 0.9%, while the non-tradables component rose 2.6%. This compares to a rise of 0.7% and a rise of 2.3% respectively through the year to the December quarter 2014.

In seasonally adjusted terms the tradables component of the All groups CPI fell 0.6%, while the non-tradables component rose 0.7%.

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 2015, the All groups CPI seasonally adjusted rose 0.3%, compared to the original All groups CPI which recorded a rise of 0.2%.

The trimmed mean rose 0.6% in the March quarter 2015, compared to a revised rise of 0.6% in the December quarter 2014. Over the twelve months to the March quarter 2015, the trimmed mean rose 2.3%, compared to a rise of 2.2% over the twelve months to the December quarter 2014.

The weighted median rose 0.6% in the March quarter 2015, compared to a rise of 0.7% in the December quarter 2014. Over the twelve months to the March quarter 2015, the weighted median rose 2.4%, compared to a revised rise of 2.4% over the twelve months to the December quarter 2014.

		ORIGINAL	SEASONALLY ADJUSTED
		Dec Qtr 2014 to Mar Qtr 2015	Dec Qtr 2014 to Mar Qtr 2015
		%	%
All groups CPI		0.2	0.3
Food and non-alcoholic beverages		0.2	0.4
Alcohol and tobacco		0.8	1.1
Clothing and footwear		-1.3	0.3
Housing		0.8	0.8
Furnishings, household equipment and services		-0.5	0.7
Health		2.5	0.6
Transport		-3.4	-3.7
Communication(a)		-1.4	-1.4
Recreation and culture		0.7	1.5
Education		5.3	1.3
Insurance and financial services		0.2	0.1
International trade exposure series
	Tradables	-1.2	-0.6
	Non-tradables	1.0	0.7
(a) not seasonally adjusted

A detailed explanation of the seasonal adjustment of the All Groups CPI and calculation of the trimmed mean and weighted median measures 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 (also see paragraph 15 of the Explanatory Notes).