The Consumers Price Index (CPI) is an indicator or measure of prices changes. It is a fixed weighted average of price relatives and is computed using the Laspeyres price index formula. The current weighting pattern is based on the 2005 Household Expenditure Survey (HES), which was carried out in  2005/06. The HES information was used to select the ‘basket’, which is the commonly used term for the goods and services prices for the purpose of compiling the CPI.

KEY FACTS

Quarterly change

In the June 2023 quarter compared with March 2023 quarter:

The Consumer Price Index for June quarter 2023 increased by 2.0 per cent.

• Clothing and Footwear division increased by 6.7%, factored by:
• Footwear group (up by 14.9 per cent)
• Clothing group (up by 5.5 per cent)
• Household contents and maintenance division increased by 4.9%, factored by increases in:
• Household appliance group (up by 18.3 per cent)
• Household textile group (up by 7.3 per cent)
• Minimal increases from the House and garden tools or equipment’s (by 2.7 per cent) and Goods and services for household maintenance (by 1.0 per cent)
• Food and Non-alcoholic Beverages division increased by 3.7%, factored by increases in:

• Non-alcoholic beverages (up by 7.4 per cent)
• Food group (up by 3.5 per cent)

• Transport division increased by 2.9%, due to higher cost of International Airfares in the Transport Services group (up by 18.2 per cent)
• Recreation and Culture division increased by 2.7%, subjective to higher prices of some items in the Other items and equipment’s (up by 9.9 per cent) and Audio-visual photographic and information groups (up by 5.8 per cent)
• Education inflation rate increased by 2.2%
• Miscellaneous Goods & Services inflation rate increased by 1.1%
• Restaurants & Hotels division increased by 0.6 per cent.
• Alcoholic Beverages and Tobacco division increased by 0.5 per cent.
• All these increases were offset by decreases in the Housing & Household Utilities Division (down by 2.6%), and Communications Division (down by 0.5%).

The Underlying CPI, which excludes prices that are considered highly volatile increased by 2.6 per cent over June quarter 2023 mainly attributable to higher cost of food prices.

Annual Change

From June 2022 quarter to June 2023 quarter, the CPI inflation rate was 10.9 per cent.

• A 18.6 per cent increase was recorded in the Food and Non-alcoholic beverages division influenced by mostly price increases of Food
• Transport division increased by 7.3 per cent
• Alcohol & Tobacco division prices increased by 4.7 percent

More on Consumers Price Index…

More information on Consumer Price Index (CPI)

The Consumer Price Index covers price changes of the basket of goods and services consumed by all households on Rarotonga (the main island).

The base year is 2019. Prices are collected for 199 items and from selected outlets around Rarotonga. Individual prices are combined using weights from the Household Income and Expenditure Survey (HIES) conducted in 2015/2016. The HIES information was used to select the basket of goods and services.

The inclusion of an underlying measure is a recent improvement and it is published at the same time as the CPI. The underlying measure excludes items of a highly volatile nature, items that are subject to policy changes.

It excludes some items fruits, vegetables, meat and fish, electricity rates, purchases of new and used motor vehicles, petrol and diesel, international airfares and domestic airfares.

The CPI is calculated as chain-linked Jevons indices (change in the geometric average price). At the higher level, indices will be calculated with standard Laspeyres-type aggregation.