Capital goods prices rise slightly

The capital goods price index (CGPI) rose slightly (up 0.1 percent) in the June 2010 quarter, Statistics New Zealand said today.

Small rises for construction-related asset prices were offset by small falls for plant, machinery, and transport equipment prices.

The CGPI measures the change in the price of physical capital goods purchased by New Zealand producers of goods and services. Capital goods are assets used to produce goods and services for more than one year.

The major upward contribution to the CGPI came from the residential buildings index (up 0.3 percent). The rise in residential building prices was largely influenced by a rise in dwelling and out-building prices.

The other construction index (which measures changes in infrastructure prices for items like construction of roads and pipelines) rose 0.1 percent, making the second largest upward contribution to the CGPI.

In the June 2010 quarter, the largest offsetting influence came from plant, machinery, and equipment prices (down 0.1 percent). This index includes items such as computer machinery, furniture, and machinery for mining, quarrying, and construction. The fall in plant, machinery, and equipment prices was influenced by the appreciation of the New Zealand dollar.

In the year to the June 2010 quarter, the CGPI fell 0.6 percent, the largest annual decrease since the year to the December 1999 quarter.