Building construction drives up CGPI

The Capital Goods Price Index (CGPI) rose 0.5 percent in the March 2008 quarter, Statistics New Zealandsaid today.

Higher construction prices for new houses and non-residential buildings were the maincontributors to the rise. Four of the six asset groups in the CGPI rose in this quarter.

The residential buildings index made the most significant upward contribution to the CGPI, rising 0.9percent in the March 2008 quarter.

The increase was mainly due to higher construction prices for newhouses driven by higher prices for construction components and increased subcontractors’ charges.

In theyear to the March 2008 quarter, the residential buildings index rose 5.0 percent.

The second largest upward contribution to the CGPI came from the non-residential buildings index whichrose 1.0 percent in the March 2008 quarter.

This rise was mainly driven by higher prices for reinforcing steelproducts and increased costs for structural steel work. In the year to the March 2008 quarter, the non-residential buildings index rose 2.3 percent.

Price decreases recorded in the plant, machinery and equipment index and the transport equipment indexoffset the CGPI increase.

Both of these indexes fell by 0.1 percent in the latest quarter largely due to theappreciating exchange rate.In the year to the March 2008 quarter, the CGPI rose 2.5 percent.

This followed a rise of 3.6 percentand 3.1 percent in the years to the March 2007 and March 2006 quarters, respectively.

Geoff BascandGovernment Statistician

There is a companion Hot Off The Press information release published – Capital Goods Price Index: March2008 quarter.