New Zealand looks likely to remain the sole OECD nation without a monthly inflation report for some time to come.
Statistics New Zealand will only start work on developing a monthly Consumer Price Index if its customers identify it as a priority during a consultation process currently underway, said Jason Attewell, General Manager Economic & Environmental Insights. In the meantime, the agency is looking at whether it can produce some components of the CPI on a monthly basis, he said.
“Developing a full monthly CPI could take a long time, and there’s a slight risk that we could take so long to develop a full monthly CPI that then the inflation crisis is over and nobody cares any more,” Attewell said in an interview. “So it’s about what can we develop now to inform our customers now for what they need right now.”
New Zealand is the last remaining member of the 38-nation OECD still relying on quarterly inflation data after Australia started producing a monthly indicator last year. The central bank has renewed its call for a more timely prices report, saying it would help it to formulate monetary policy as it battles the fastest inflation in three decades.
“The Reserve Bank believes that a monthly CPI is important to support effective monetary policy decision-making,” the RBNZ said in a paper published in November. A monthly report would also improve the robustness of the measure, increase its credibility and enhance its international comparability, it said.
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Attewell agreed that inflation is a hot topic and said Statistics New Zealand is “getting more and more demand for a monthly CPI.”
However, the agency has “a finite amount of resources” and “a lot of gaps” across its suite of statistics, he said.
Feedback from the consultation process was still being worked through, a series of workshops is being planned and there was no date for when a conclusion would be drawn, he said.
If customers do identify a monthly CPI as an important priority, Statistics New Zealand would start to develop one.
“We’d have to look at that stage whether we could get more funding to do that, or whether we could just reprioritize within what we’re doing now to focus on that,” Attewell said.
For now, the agency is looking at whether it can publish some additional parts of the CPI basket on a monthly basis, as it already does with food and housing rental prices, he said. Fuel and other transport costs could be candidates for monthly reports.
“We’re not looking to make a proxy monthly CPI,” Attewell said. “It would be like what bits of the CPI could we put out monthly. We’re just in the exploratory stage now, so I can’t give you a timeframe on that. We’re just looking into what are the options.”