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 December 2021 quarter compared with March 2022 quarter, the All Group Consumer Price Index (CPI) increased by 3.2 percent and the Underlying CPI increased by 3.5 percent.
- The Housing, Water, Electricity, Gas and Other Fuels Division had a 6.5 per cent increase in its index for March Quarter 2022. This was mainly attributable to an 11.9 per cent rise in the index for Electricity Gas and Other Fuels Group due to higher cost of cooking gas
- The Clothing and Footwear Group division increased by 5.4 per cent. The main contributor to this movement was an increase of 6.1 per cent in the index in the Clothing Group
- The index for the Food and Non-Alcoholic Beverages Division increased by 4.7 per cent. Though most classes within the ‘Food’ groups had increases in their index; ‘Sugar, jam, honey, chocolate and confectionery index escalated to 10.9 per cent, Fruits moved up by 8.1 per cent, Meat class went up by 8.0 per cent, Food products increased by 6.9 per cent, Oils & Fat up by 5.5 per cent, Milk, cheese and eggs index rose by 5.0 per cent followed by slight increases of 2.4 per cent, 1.5 per cent and 1.2 per cent in the Bread & cereals, Water, Drinks & Juices, Fish & Sea food, and Vegetables Classes
- The index for the Miscellaneous Goods & Services Division increased by 3.4 per cent. The main factors which contributed to the upward movement in the index for this division were higher prices for some items within the Other Services Group of 16.3 per cent, Personal effects Group of 14.5 per cent and Personal Care Group of 2.2 per cent
- Restaurants and Hotel Services Division rose by 2.9 per cent. A 3.1 per cent increase in the index for the Catering Services Group influenced the rise, primarily due to a higher cost of meals consumed at Restaurants and Cafes
- A 2.1 per cent increase was recorded in the index for Transport Division. This upward movement was mainly attributed to higher costs for Purchase of vehicles and Transport services Group
- Recreation and Culture Division increased by 1.8 per cent. The marginal uptick was due to mainly the price increase in the Newspaper, books and stationery subgroup by 9.5 per cent and a 1.0 per cent increase from the other recreational items
- Alcoholic Beverages and Tobacco Division had a increase of 0.4 per cent. The main contribution to this movement was a 9.4 percent increase in the index subgroup division ‘wine’.
- All these increases were tapered by the decrease in the Household Contents & Maintenance Division and the Communications Division which had a 0.4 per cent and 0.2 per cents fall subjective to lower prices of furniture’s and telephone equipment’s
Annual change
From the March 2021 quarter to the March 2022 quarter, the CPI inflation rate was 5.7 per cent with the Underlying CPI 4.3 per cent
- A 13.4 per cent increase was recorded in the annual index for the Transport Division impacted mostly by price increases of fuel
- Food Division rose by 8.2 per cent, influenced by price increases in nearly everything in the Food sub-group
Meat up by 15%, Sugar, jam, honey, chocolate, & confectionery by 10%, Fruits subgroup, Oils & fats subgroup and Food products subgroup rose by 8%, milk, cheese & eggs subgroup and Mineral, soft drinks and vegetable juices slightly increased by 7%, Bread & cereals subgroup, Fish & Sea food subgroup and the Vegetable subgroups went up by 5% followed by small increase in the coffee, tea and cocoa of 1%.
- Alcohol & Tobacco Division made minimal increases of 0.3 per cent.
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Information about 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.
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