6401.0 - Consumer Price Index, Australia, Jun 2017 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 26/07/2017   
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MAIN CONTRIBUTORS TO CHANGE


CPI GROUPS

The discussion of the CPI groups below is ordered in terms of their absolute significance to the change in All groups index points for the quarter (see Tables 6 and 7). Unless otherwise stated, the analysis is in original terms.

Weighted average of eight capital cities, Percentage change from previous quarter
Graph: Weighted average of eight capital cities, Percentage change from previous quarter



HEALTH GROUP (+2.7%)

The main contributor to the rise in the health group this quarter is medical and hospital services (+4.1%). The rise is due to the annual increase in private health insurance (PHI) premiums on 1 April, and at the same time, the annual decrease in the PHI rebate. The rise is partially offset by a fall in pharmaceutical products (-1.1%) due to the cyclical effect of a greater proportion of consumers exceeding the Pharmaceutical Benefits Scheme (PBS) safety net.

Over the last twelve months, the health group rose 3.8%. The main contributor to the rise is medical and hospital services (+5.3%).

In seasonally adjusted terms, the health group rose 0.9% this quarter. The main contributor to the rise is medical and hospital services (+1.1%).


HOUSING GROUP (+0.3%)

The main contributors to the rise in the housing group this quarter are new dwelling purchase by owner-occupiers (+0.9%), gas and other household fuels (+0.4%) and rents (+0.2%). The rise in new dwelling purchase by owner-occupiers is driven by rises in input costs. The rise in gas and other household fuels is driven by the seasonal switch to peak pricing in Melbourne. The rise is partially offset by a fall in electricity (-0.2%) due to the seasonal switch to off-peak pricing in Adelaide.

Over the last twelve months, the housing group rose 2.4%. The main contributors to the rise are new dwelling purchase by owner-occupiers (+2.8%) and electricity (+7.8%).

In seasonally adjusted terms, the housing group rose 0.8% this quarter. The main contributor to the rise is new dwelling purchase by owner-occupiers (+0.9%).


RECREATION AND CULTURE GROUP (-0.6%)

The main contributor to the fall in the recreation and culture group this quarter is domestic holiday travel and accommodation (-3.2%). The fall in domestic holiday travel and accommodation is typical of the off peak season for domestic holiday travel.

Over the last twelve months, the recreation and culture group fell 0.1%. The main contributors to the fall are international holiday travel and accommodation (-3.7%) and audio, visual and computing equipment (-7.0%). The fall is partially offset by a rise in domestic holiday travel and accommodation (+2.2%).

In the CPI, airfares and accommodation are collected in advance (at the time of payment), but are only used in the CPI in the quarter in which the trip is undertaken. International airfares are collected two months in advance (April for travel in June) and domestic airfares and accommodation are collected one month in advance (May for travel in June).

In seasonally adjusted terms, the recreation and culture group rose 0.5% this quarter. The main contributor to the rise is international holiday travel and accommodation (+1.5%).


ALCOHOL AND TOBACCO GROUP (+0.8%)

The main contributor to the rise in the alcohol and tobacco group this quarter is tobacco (+1.0%). The rise in tobacco is due to flow on effects from the federal excise tax increase effective from 1 March 2017.

Over the last twelve months, the alcohol and tobacco group rose 5.9%. The main contributor to the rise is tobacco (+12.1%).

In seasonally adjusted terms, the alcohol and tobacco group rose 1.1% this quarter. The main contributor to the rise is tobacco (+1.9%).


FURNISHINGS, HOUSEHOLD EQUIPMENT AND SERVICES GROUP (+0.7%)

The main contributors to the rise in the furnishings, household equipment and services group this quarter are household textiles (+4.0%), glassware, tableware and household utensils (+1.0%) and furniture (+0.9%), following discontinued post-Christmas sales.

Over the last twelve months, the furnishings, household equipment and services group recorded no movement. The main positive contributor is child care (+6.1%) and the main negative contributor is furniture (-2.9%).

In seasonally adjusted terms, the furnishings, household equipment and services group rose 0.2% this quarter.


TRANSPORT GROUP (-0.6%)

The main contributor to the fall in the transport group this quarter is automotive fuel (-2.5%). Automotive fuel fell in April (-0.8%), rose in May (+0.2%) and fell in June (-0.6%). All fuel types recorded falls this quarter. The fall is partially offset by rises in motor vehicles (+0.3%) and urban transport fares (+0.2%).

The following graph shows the pattern of the average daily prices for unleaded petrol for the eight capital cities over the last fifteen months.

AVERAGE PRICE OF UNLEADED PETROL (91 OCTANE), cents per litre
Graph: AVERAGE PRICE OF UNLEADED PETROL (91 OCTANE), cents per litre


Over the twelve months, the transport group rose 2.1%. The main contributor to the rise is automotive fuel (+6.9%). This rise is partially offset by a fall in motor vehicles (-1.3%).

In seasonally adjusted terms, the transport group fell 0.5% this quarter. The main contributor to the fall is automotive fuel (-2.5%).


FOOD AND NON-ALCOHOLIC BEVERAGES GROUP (-0.2%)

The main contributors to the fall in the food and non-alcoholic beverages group this quarter are fruit (-4.4%) and snacks and confectionary (-1.3%). Rises in selected fruits and vegetables resulting from crop damage due to Cyclone Debbie were observed for tomatoes, beans, cucumbers, melons, berries and bananas. However, these rises were offset by falls in seasonally available fruits such as oranges, mandarins and apples. For vegetables there has been an increase in the supply of potatoes following a shortage due to adverse weather conditions previous periods.

Over the last twelve months, the food and non-alcoholic beverages group rose 1.9%. The main contributors to the rise is vegetables (+11.1%), restaurant meals (+2.8%) and fruit (+6.4%). Adverse weather conditions in major growing areas in previous periods impacted the supply for particular vegetables and fruits.

In seasonally adjusted terms, the food and non-alcoholic beverages group rose 0.3% this quarter. The main contributor to the rise is vegetables (+1.6%).


COMMUNICATION GROUP (-0.5%)

The main contributor to the fall in the communication group this quarter is telecommunication equipment and services (-0.5%).

Over the last twelve months, the communication group fell 3.8%. The main contributor to the fall is telecommunication equipment and services (-4.2%).

The communication group is not seasonally adjusted.


CLOTHING AND FOOTWEAR GROUP (-0.3%)

The main contributors to the fall in the clothing and footwear group this quarter are garments for men (-1.9%) and garments for women (-1.0%) as a result of sustained periods of specials. The fall is partially offset by rises in garments for infants and children (+1.4%) and accessories (+0.4%).

Over the last twelve months, the clothing and footwear group fell 1.9%. The main contributor to the fall is garments for women (-4.9%).

In seasonally adjusted terms, the clothing and footwear group fell 1.4% this quarter. The main contributors to the fall are garments for men (-4.2%) and garments for women (-2.1%).


INSURANCE AND FINANCIAL SERVICES GROUP (-0.1%)

The main contributor to the fall in the insurance and financial services group this quarter is insurance (-1.0%). The fall is partially offset by rises in deposit and loan facilities (direct charges) (+0.5%) and other financial services (+0.3%). The fall in insurance is related to the NSW Government's planned removal of the Emergency Services Levy (ESL) from Home and Contents insurance premiums in NSW from 1 July 2017. The NSW Government decided on 30 May to delay the removal of the ESL from insurance premiums. Some insurers in NSW had already started passing on the savings from the anticipated removal of the ESL, resulting in the price falls this quarter.

Over the past twelve months, the insurance and financial services group rose 2.1%. The main contributor to the rise is insurance (+4.3%).

In seasonally adjusted terms, the insurance and financial services group rose 0.2% this quarter. The main contributor to the rise is deposit and loan facilities (direct charges) (+0.5%).


EDUCATION GROUP (0.0%)

The education group recorded no movement this quarter.

Over the last twelve months, the education group rose 3.3%. The main contributors to the rise are secondary education (+4.1%) and tertiary education (+2.6%).

In seasonally adjusted terms, the education group rose 1.3% this quarter. The main contributors to the rise are tertiary education (+1.3%) and secondary education (+1.2%).


INTERNATIONAL TRADE EXPOSURE - TRADABLES AND NON-TRADABLES

The tradables component (see Table 8) of the All groups CPI fell 0.3% this quarter. Price changes for the goods and services in this component are largely determined on the world market. The tradables component represents approximately 35% of the weight of the CPI. The tradable goods component recorded a fall of 0.4% this quarter. The most significant negative contributor is automotive fuel (-2.5%), while the most significant positive contributor is household textiles (+4.0%). The rise in the tradable services component of 0.8% is driven by international holiday travel and accommodation (+0.9%).

The non-tradables component of the All groups CPI rose 0.4% this quarter. Price changes for the goods and services in this component are largely determined by domestic price pressures. The non-tradables component represents approximately 65% of the weight of the CPI. The most significant contributors to the 0.6% rise in the non-tradable goods component are new dwelling purchase by owner-occupiers (+0.9%) and tobacco (+1.0%). The rise in the non-tradable services component of 0.3% is driven by medical and hospital services (+4.1%) and restaurant meals (+0.7%).

Over the last twelve months, the tradables component rose 0.4%, while the non-tradables component rose 2.7%. This compares to a rise of 1.3% and 2.6% respectively over the twelve months to the March quarter 2017.

In seasonally adjusted terms, the tradables component of the All groups CPI fell 0.3% this quarter, while the non-tradables component rose 0.7%.

A detailed description of which expenditure classes are classified as tradable and non-tradable in the 16th series is shown in the Appendix of the December quarter 2016 issue of Consumer Price Index, Australia (cat. no 6401.0).


SEASONALLY ADJUSTED ANALYTICAL SERIES

The All groups CPI seasonally adjusted rose 0.4% this quarter, compared to the original All groups CPI which recorded a rise of 0.2%.

The trimmed mean rose 0.5% this quarter, compared to a rise of 0.5% in the March quarter 2017. Over the last twelve months, the trimmed mean rose 1.8%, compared to a revised rise of 1.8% over the twelve months to the March quarter 2017.

The weighted median rose 0.5% this quarter, compared to a revised rise of 0.5% in the March quarter 2017. Over the last twelve months, the weighted median rose 1.8%, compared to a rise of 1.7% over the twelve months to the March quarter 2017.

ORIGINAL
SEASONALLY ADJUSTED
Mar Qtr 2017 to Jun Qtr 2017
Mar Qtr 2017 to Jun Qtr 2017
%
%

All groups CPI
0.2
0.4
Food and non-alcoholic beverages
-0.2
0.3
Alcohol and tobacco
0.8
1.1
Clothing and footwear
-0.3
-1.4
Housing
0.3
0.8
Furnishings, household equipment and services
0.7
0.2
Health
2.7
0.9
Transport
-0.6
-0.5
Communication(a)
-0.5
-0.5
Recreation and culture
-0.6
0.5
Education
0.0
1.3
Insurance and financial services
-0.1
0.2
International trade exposure series
Tradables
-0.3
-0.3
Non-tradables
0.4
0.7

(a) not seasonally adjusted


A detailed explanation of the seasonal adjustment of the All Groups CPI and calculation of the trimmed mean and weighted median measures is available in Information Paper: Seasonal Adjustment of Consumer Price Indexes, 2011 (cat. no. 6401.0.55.003) available on the ABS website. Revisions to the seasonally adjusted estimates can be the result of the application of concurrent seasonal adjustment, described in paragraph 15 of the Explanatory Notes.