Inflation drops, property sales rise

Latest data on the Consumer Price Index has shown inflation dropped in the second quarter of 2023, from 6.7 percent to 6.0 percent. Food prices remained the biggest problem, and were the largest contributor to the June 2023 annual inflation rate. That was due to rising prices for vegetables, ready-to-eat food, milk, cheese, and eggs. Vegetable prices increased 23.3 per cent in the year to June 2023, affected especially by labour shortages, erratic weather, and increases in wage and fuel costs.

The overall 6 percent figure is broadly on a par with the Euro Zone and the USA (whose published figure of 3 percent is based on different criteria), and below that of the UK (8.7 percent) and Australia (7 percent).

When it comes to tackling inflation, Westpac chief economist Kelly Eckhold told the New Zealand Herald, ‘A lot of the market participants would say the US and New Zealand have done some of the better jobs.’ (paywall content)

Meanwhile, CoreLogic NZ’s latest Monthly Housing Chart Pack shows residential sales figures increased 17 percent in the 12 months to June, hot on the heels of the 8 percent annual bump recorded in May. ‘It’s important to note that this increase has started from a low base, but as pent-up demand starts to emerge it’s likely we’ll see more increases in sales activity in the remainder of 2023,’ said CoreLogic NZ Chief Property Economist Kelvin Davidson.