Tag Archives: DEFLATION

‘Low inflation’ v House price inflation

deflation-the-japan-times[Japan Times]

### NZ Herald Online 12:00 PM Tuesday Oct 18, 2016
Economy
No inflation? So why doesn’t it feel like it?
By Liam Dann – NZ Herald business editor at large
If yesterday’s Consumer Price Index, showing just 0.2 per cent inflation in the past year didn’t match your experience of rising prices, fear not, there is a new set of data that could offer a more realistic reflection of Kiwi household costs. The CPI for the year to September came in slightly higher than the predictions of most economists but still takes the economy dangerously close to deflation – a phenomenon where falling price expectations start to suppress economic growth. […] Meanwhile, the Household Living-costs Price Index (HLPI) gets much less attention from economists but has been designed over the past three years to reflect the fact that real world inflation varies greatly depending on your household wealth and expenditure, Matt Haigh [Statistics NZ consumer prices manager] said. It offers data for specific sub-sections of New Zealand such as beneficiaries, Maori, superannuitants, five different income groupings and five expenditure groups. In doing so it captures inequalities of price inflation which the CPI does not. So for example rent, which was up 3.4 per cent for the year in Auckland, is factored into the CPI with a weighting of 10 per cent. But, said Haigh, in reality for many renters it is likely to be more like 40 per cent of total expenditure. That weighting is more accurately reflected in the HLPI – especially in the lower income groups.
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█ On November 8 Statistics New Zealand will provide its first live quarterly update for the HLPI data, with details for the year to September, and it should provide more insight for those looking at inflation from a social or political perspective. Backdated HLPI data for the year to September 2015 is already available on the Statistics NZ website.

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deflationary-cycle-web-world-cycles-instituteDeflationary cycle web [World Cycles Institute]

For many New Zealanders the low inflation story doesn’t stack up with daily experience. That’s because one of the largest costs we face in life, house price inflation, continues to rise more than anything else.

### NZ Herald Online 6:41 AM Tuesday Oct 18, 2016
Liam Dann: Inflation now at dangerously low level
OPINION Inflation data due today is tipped to show the economy skating dangerously close to deflation. Economists’ forecasts for the September quarter Consumer Price Index have inflation falling in the past three months and now only just above zero on an annualised basis. Most economists are picking it will come in at 0.1 or 0.2 per cent for the year to September 30 – down from 0.4 per cent in the year to June 30. The fall is expected to be driven by lower transport costs as oil slumped again in the quarter while housing costs are likely to be the largest rising category. Persistently low inflation is considered one of just a few dark spots in another otherwise rosy economic picture, although it is consistent with a number of other economies right now.
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Posted by Elizabeth Kerr

This post is offered in the public interest.

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Dunedin City Council to set rates WAY ABOVE….

1% inflation

Updated post Thu, 22 Jan 2015 at 1:10 p.m.

### ODT Online Wed, 21 Jan 2015
Editorial: Dunedin’s rating dilemmas
OPINION The council’s pre-draft long-term plan – which is yet to be refined or considered by the public – forecasts a rates rise of 3.7% for 2015-16, followed by 5.5% and then 4.2% in subsequent years. This is at a time when the inflation rate could well be about 1% and wage increases and benefit hikes about the same level. This also follows many years of rates rises above the increase in the cost of living.
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Comment at ODT Online:

Council debt
Submitted by Barnaby on Wed, 21/01/2015 – 8:37pm.

Mayor Dave Cull says, Dunedin “is on a bit of a roll”. So was the Titanic! This comment shows how genuinely out of touch he is with Dunedin businesses and ratepayers alike, who are struggling to fund one lunatic project after another, let alone make a living. He confuses misappropriation of ratepayers’ funds with “investing in the city”. To highjack rates for more silly things is neither fair nor moral. The DCC is now so far from core council services it is ludicrous. Now more than ever, Dunedin desperately needs a leader with business experience and skills.

Related Posts and Comments:
15.1.15 Did the pool trust reply, Dr Hamlin?
14.1.15 DCC Draft Long Term Plan: more inanity from Cull’s crew pending

Posted by Elizabeth Kerr

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