Producer prices drop

milk powder in clayProducer prices fell in the last quarter of 2015 due to lower dairy and fuel prices, Statistics New Zealand reported.

Prices received (as measured by the output producers price index (PPI)) and paid (as measured by the input PPI), both fell in the December 2015 quarter, which is down 0.8 per cent and 1.2 per cent, respectively.

Manufacturers of dairy products received lower prices, down 10 per cent, influenced mainly by lower prices for milk powder.

Also in the same period, lower farm-gate milk prices led to lower prices received by dairy cattle farmers, down 9.2 per cent, and paid by dairy product manufacturers, down 7.1 per cent.

Prices for purchasing capital goods, measured by the capital goods price index (CGPI), rose 0.6 per cent. Higher prices for construction of residential and non-residential buildings, and for plant, machinery, and equipment mainly contributed to the CGPI increase.

In the year to the December 2015 quarter, the output PPI was down 0.6 per cent, and the input PPI was down 1.1 per cent. The CGPI rose 3.2 per cent.

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