Rates push inflation up

Stats NZ reports:

Aotearoa New Zealand’s consumers price index (CPI) increased 2.7 percent in the 12 months to the June 2025 quarter, according to figures released by Stats NZ today. …

The largest upwards contributor to the annual inflation rate was local authority rates and payments, up 12.2 percent. Rates contributed 13 percent of the 2.7 percent annual increase.

2.7% is getting a bit too close to the 3% limit the Reserve Bank should target, but what I always focus on is whether it is non-tradeable or domestic inflation or tradeable.

Tradeable inflation has gone up. It is 1.2%, compared to 0.3% a year ago.

Non-tradeable inflation is 3.7%. Still too high but this is a four year low. A year ago it was 5.4%.

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