Surging petrol prices push up inflation

Soaring petrol prices were a key factor behind a 0.8 percent rise in the consumers' price index (CPI) in the March quarter and a 4.5 percent rise for the year to March, Statistics New Zealand (SNZ) figures show.
The rise was slightly less than expected, with the median forecasts in a Reuters survey having been for a 1 percent rise over the quarter and a 4.6 percent gain on the year.
The result knocked back the high flying New Zealand dollar which had briefly topped US80c for the first time in three years earlier, but fell from around US79.85c to US79.55c in the minutes after the data was released.
SNZ prices manager Chris Pike said the 0.8 percent March quarter rise in the CPI reflected higher prices for petrol, cigarettes, tobacco, and food.
The transport group rose 2.5 percent in the quarter, with a rise in petrol prices of 9.7 percent being countered by a seasonal fall of 9.2 percent in international airfares.
``Petrol prices have increased strongly over the past six months and at the end of March were only slightly below their peak in July 2008,'' Mr Pike said.
Cigarette and tobacco prices rose 9.4 percent in the March quarter, reflecting an 11.6 percent increase in excise duty at the start of 2011.
Food prices rose 1.2 percent, with prices for grocery food up 1.1 percent and meat, poultry, and fish up 2.1 percent. The rise in grocery food prices reflected a 1.4 percent rise in prices for bread and cereals, along with a 1.3 percent rise in prices for the milk, cheese, and eggs group.
The 4.5 percent rise in the CPI for the year to the March quarter included a 2.3 percent increase in the December quarter when GST rose from 12.5 to 15 percent.
Significant upward contributions in the year to March came from an 8.2 percent rise in prices for transport, a 4 percent rise in housing and household utilities, a 4.8 percent rise in food, and an 11.4 percent rise in alcoholic beverages and tobacco.
Petrol prices rose 17.1 percent in the year, while cigarette and tobacco prices rose 26.1 percent, reflecting two rises in excise duty on both cigarettes and tobacco.