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PRICE INDEXES AND CONTRACT PRICE INDEXATION
1 ALL GROUPS, INDEX NUMBERS(a)
2 ALL GROUPS, PERCENTAGE CHANGES
CPI All GROUPS, WEIGHTED AVERAGE OF EIGHT CAPITAL CITIES, INDEX NUMBERS(a)

SEPTEMBER QTR KEY FIGURES

	Jun Qtr 2006 to Sep Qtr 2006	Sep Qtr 2005 to Sep Qtr 2006
Weighted average of eight capital cities	% change	% change
Food	2.3	9.9
Alcohol and tobacco	0.5	3.2
Clothing and footwear	0.1	-1.8
Housing	1.2	3.3
Household contents and services	1.3	2.4
Health	-0.7	5.0
Transportation	0.4	4.6
Communication	0.6	0.5
Recreation	0.8	1.0
Education	-0.8	4.9
Financial and insurance services	0.3	2.4
All groups	0.9	3.9
All groups excluding Housing and Financial and insurance services	0.8	4.2

All Groups Quarterly change, Quarterly change

Contribution to quarterly change, September quarter 2006

SEPTEMBER QTR KEY POINTS


THE ALL GROUPS CPI

• rose 0.9% in the September quarter 2006 compared with 1.6% in the June quarter.
• rose 3.9% through the year to September quarter 2006.

• Contributing most to the increase this quarter were fruit (+20.5%), property rates and charges (+5.6%), rents (+1.0%), water and sewerage (+4.7%), other household supplies (+2.9%), electricity (+2.1%), motor vehicles (+0.8%), insurance services (+2.2%), tobacco (+1.4%) and domestic holiday travel and accommodation (+1.2%).
• The increase in fruit contributed 0.3 percentage points to the September quarter CPI increase.
• The most significant offsetting price falls were vegetables (-5.3%), pharmaceuticals (-5.0%), automotive fuel (-1.1%) and tertiary education (-2.2%).

ABBREVIATIONS

ABS Australian Bureau of Statistics

CPI Consumer Price Index

INQUIRIES

For further information about these and related statistics, contact Lee Taylor on Canberra (02) 6252 6251 or the National Information and Referral Service on 1300 135 070.

ANALYSES AND COMMENTS


MAIN CONTRIBUTORS TO CHANGE


CPI GROUPS

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

FOOD (+2.3%)

The rise in food prices was largely due to fruit (+20.5%), soft drinks, waters and juices (+3.2%), take away and fast foods (+0.9%), restaurant meals (+0.9%) and snacks and confectionery (+0.8%). The only offsetting price fall of any significance was in vegetables (-5.3%).

Increases in distribution and packaging costs were again cited by a number of respondents as contributing to price rises in a number of food categories.

The rise in fruit prices reflected strong price increases for a number of fruit. Price rises for bananas, which began following Cyclone Larry, continued with the average price recorded for September quarter being 45% higher than the average recorded for June quarter. Melons, apples and pears also showed rises. The rise in fruit contributed 0.48 index points to the increase in the CPI in the September quarter.

The fall in the price of vegetables was associated with plentiful supplies of salad vegetables and green leafy vegetables.

Over the twelve months to September quarter 2006, food prices rose 9.9%. The main contributors to the increase were fruit (+92.1%), vegetables (+9.3%) and takeaway and fast foods (+3.6%). The only offsetting fall was in poultry (-3.3%).

HOUSING (+1.2%)

All categories of housing recorded price rises this quarter. Main contributors to the increases were property rates and charges (+5.6%), rents (+1.0%), water and sewerage (+4.7%) and electricity (+2.1%).

A number of rises were due to the annual review of prices by State and local government authorities and utility providers. Property rates and charges rose in all capital cities with increases ranging from 4.2% in Brisbane to 17.2% in Canberra.

All capital cities with the exception of Sydney and Melbourne recorded a rise in house purchase in the September quarter. In Sydney and Melbourne bonuses were offered by project home builders in an attempt to attract buyers.

Through the year to September quarter 2006, the housing group rose 3.3%. This rise was mainly attributable to house purchase (+2.9%), rents (+3.4%) and property rates and charges (+5.6%). Annually, house purchase rose across all cities except Melbourne (-1.6%), with Perth (+14.7%) and Darwin (+13.0%) showing the strongest rises.

HOUSEHOLD CONTENTS AND SERVICES (+1.3%)

Household contents and services rose +1.3% this quarter, the largest quarterly rise since June quarter 2001 (+1.7%). With the exception of major household appliances (-1.9%), all categories of household contents and services rose this quarter with other household supplies (+2.9%), furniture (+1.4%) and child care (+3.3%), being the most significant. The rise in other household supplies was largely due to an increase in household paper products (+6.7%). Furniture rose due mostly to price rises in lounge room furniture (+2.1%).

Child care prices are calculated on a net basis, after accounting for government subsidies. General fee rises this quarter, particularly in family day care, exceeded the increase in subsidy, leading to an increase in the net price of child care in most cities. Only Canberra and Hobart showed net falls.

Over the year to September quarter 2006, the household contents and services group rose +2.4% with child care (+14.4%) and other household supplies (+4.7%) being the most significant contributors.

RECREATION (+0.8%)

The rise in the recreation index was mainly due to domestic holiday travel and accommodation (+1.2%), other recreational activities (+2.4%) and overseas holiday travel and accommodation (+1.4%). The major offsetting price fall was in audio, visual and computing equipment (-1.5%).

The rises in domestic overseas holiday travel and accommodation reflected the impact of sustained higher fuel prices being passed onto consumers. Increased fuel prices also applied to overseas holiday travel and accommodation, along with seasonal demand in USA and Europe.

The fall in audio, visual and computing equipment was mainly due to continuing falls in prices of computers and televisions and strong competition between retailers.

TRANSPORTATION (+0.4%)

With the exception of automotive fuel (-1.1%), all categories in transportation rose this quarter, with motor vehicles (+0.8%), other motoring charges (+2.8%) and urban transport fares (+2.5%) being the most significant.

Automotive fuel prices rose in April (+7.7%), May (+2.4%) and June (+2.5%), then fell in July (-0.5%), August (-0.1%) and September (-8.9%), leading to the overall fall of -1.1% between the June and September quarters 2006. The automotive fuel expenditure class contributed -0.08 index points to the change in the All Groups CPI in June quarter 2006 and +0.66 index points to the through the year change.

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

Through the year to September quarter 2006, the transportation group rose 4.6%, primarily due to a 10.5% rise in automotive fuel.

ALCOHOL AND TOBACCO (+0.5%)

Three of the four components in the alcohol and tobacco group rose this quarter with contributions from tobacco (+1.4%), beer (+1.0%), and spirits (+0.9%) being partly offset by wine (-1.4%).

The rises in tobacco, beer and spirit prices were mainly due to the effect of the increase in Federal excise and customs duty from 1 August. However, competitive pressures resulted in widespread discounting in beer, particularly in the earlier part of the quarter.

Through the year to September quarter 2006, the alcohol and tobacco group rose 3.2%.

FINANCIAL AND INSURANCE SERVICES (+0.3%)

The rise in financial and insurance services in the September quarter was due to increases in insurance services (+2.2%) and other financial services (+0.8%), offset by falls in deposit and loan facilities (-0.6%).

The rise in insurance services was mainly due to increases in house insurance and house contents insurance, partly offset by a fall in motor vehicle insurance. The rise in other financial services was due to increased stamp duty payments on real estate transfers.

The deposit and loan facilities component aims to measure the total cost of the financial service and therefore covers both those fees and charges levied directly on households and those paid indirectly via differences in interest rates on loans and those on deposits ('interest rate margins'). A small decrease occurred this quarter in home loan products.

Through the year to September quarter 2006, the financial and insurance services group rose 2.4%.

HEALTH (-0.7%)

The fall in health costs in September quarter 2006 was due to a fall in pharmaceuticals (-5.0%) more than offsetting rises in dental services (+1.5%) and the net cost of hospital and medical services (+0.4%).

The fall in the net cost of pharmaceuticals was due to a combination of small falls in gross prices plus the cyclical effect of the Pharmaceutical Benefits Scheme, as the number of people accessing benefits rises throughout the calendar year.

The rise in dental services was due to general price rises in all cities except Hobart.

The small rise in hospital and medical services was due increases in doctors' fees overshadowing the impact of increased Bulk Billing ratios.

Over the year to September quarter 2006, the health group rose +5.0%, primarily due to increases in hospital and medical services (+5.7%) driven by health insurance costs, dental services (+5.8%) and pharmaceuticals (+3.0%).

EDUCATION (-0.8%)

Education fell in the September quarter, due entirely to a fall in tertiary education (-2.2%) reflecting the impact of the removal of compulsory student union fees.

Universities differed in their approach to this change. Some charged an upfront annual fee, while others have chosen to continue to provide these services for the remainder of the current year free of charge. Some universities introduced voluntary fees to cover some or all of the services previously provided for by these fees.

Through the year to September quarter 2006, the education group rose +4.9%, mostly due to a +6.9% rise in secondary education fees.

TRADABLES AND NON-TRADABLES

The non-tradables component of the CPI, which represents approximately 58% of the CPI and includes goods and services whose prices are largely determined by domestic price pressures, rose 1.0% in the September quarter. Within non-tradables, the services component rose 0.9%, mainly due to property rates and charges, rents, insurance services and domestic holiday travel and accommodation. Offsets were provided by tertiary education and deposit and loan facilities. The non-tradables goods component also rose 0.9% with water and sewerage, and electricity being the main contributors. A fall in poultry provided the only offset.

The tradables component (see table 8) of the All groups CPI rose 0.8%. This component includes goods and services whose prices are largely determined on the world market and represents approximately 42% of the weight of the CPI. The main contributors to the increase were fruit, motor vehicles and tobacco. Falls in vegetables, pharmaceuticals and automotive fuel provided the most significant offsets.

Through the year to September quarter 2006, tradables rose 4.4% and non-tradables rose 3.6%. This compares with rises of 4.8% and 3.4%, respectively, for these components through the year to June quarter 2006.

CAPITAL CITIES COMPARISON


ALL GROUPS

All Groups: Percentage change from previous quarter

Melbourne's result was driven mostly by a lower than average increase in housing, combined with falls in health, clothing and footwear. The lower result for Hobart was largely due to that city recording falls in transportation, larger than average falls in education and health, and smaller than average rises in food and housing. Canberra's result was largely due to falls in transportation, combined with larger than average falls in education and health and smaller than average rises in food.

The higher result for Darwin was driven by higher than average rises in recreation, housing and alcohol and tobacco.

Through the year to September quarter 2006, the All groups CPI rose in all capital cities with the increases ranging from 3.3% in Hobart to 4.9% in Darwin. Price increases in Perth were also high (+4.8%). The higher result for Perth was largely due to a 9.3% rise in housing, nearly triple the 3.3% increase for the weighted average of eight capital cities. Darwin also recorded a rise for housing (+8.3%) well above the national average.

CPI, All groups index numbers and percentage changes
	Index number(a)	Percentage change
	Sep Qtr 2006	Jun Qtr 2006 to Sep Qtr 2006	Sep Qtr 2005 to Sep Qtr 2006
Sydney	156.1	0.9	3.7
Melbourne	153.7	0.7	3.4
Brisbane	157.5	0.8	4.4
Adelaide	159.3	1.1	3.8
Perth	154.9	1.1	4.8
Hobart	155.1	0.7	3.3
Darwin	151.8	1.7	4.9
Canberra	156.0	0.7	4.2
Weighted average of eight capital cities	155.7	0.9	3.9
(a) Base of each index: 1989-90 = 100.0. SELECTED TABLES FROM CONSUMER PRICE INDEX, AUSTRALIA (CAT. NO. 6401.0) 1 ALL GROUPS, INDEX NUMBERS(a) ALL GROUPS, Index numbers(a) Period Sydney Melbourne Brisbane Adelaide Perth Hobart Darwin Canberra Weighted average of eight capital cities 2002-03 141.1 139.7 140.7 142.7 136.8 139.1 136.8 139.7 140.2 2003-04 144.1 142.8 144.8 147.0 139.6 142.6 138.7 143.4 143.5 2004-05 147.7 145.7 148.5 150.4 144.0 147.1 141.8 146.7 147.0 2005-06 152.1 150.2 153.2 155.2 150.1 151.8 146.5 151.9 151.7 2002 September 139.6 137.8 139.2 140.3 135.8 137.5 135.4 138.1 138.5 December 140.4 139.0 139.9 141.5 136.4 138.0 136.2 139.2 139.5 2003 March 142.1 140.9 141.8 144.6 137.4 140.0 137.5 140.7 141.3 June 142.2 140.9 141.8 144.3 137.4 140.8 137.9 140.7 141.3 September 142.4 141.8 143.3 145.4 138.6 141.1 137.8 141.9 142.1 December 143.6 142.1 144.2 146.2 139.2 142.0 138.5 142.9 142.8 2004 March 145.0 143.5 145.4 147.7 139.6 143.0 139.0 143.9 144.1 June 145.5 143.9 146.3 148.6 141.0 144.3 139.6 144.8 144.8 September 146.2 144.2 146.8 149.0 142.0 145.0 140.8 145.5 145.4 December 147.3 145.3 148.0 150.0 143.3 146.7 141.1 146.3 146.5 2005 March 148.2 146.4 149.2 150.9 144.4 148.0 141.9 147.0 147.5 June 149.0 146.9 150.0 151.8 146.3 148.8 143.2 147.8 148.4 September 150.5 148.6 150.9 153.4 147.8 150.1 144.7 149.7 149.8 December 151.0 149.2 152.1 154.1 149.0 151.0 145.4 150.9 150.6 2006 March 152.2 150.5 153.5 155.6 150.5 152.2 146.7 152.2 151.9 June 154.7 152.6 156.2 157.6 153.2 154.0 149.2 154.9 154.3 September 156.1 153.7 157.5 159.3 154.9 155.1 151.8 156.0 155.7 (a) Base of each index: 1989-90 = 100.0. Back to top 2 ALL GROUPS, PERCENTAGE CHANGES ALL GROUPS, Percentage changes Period Sydney Melbourne Brisbane Adelaide Perth Hobart Darwin Canberra Weighted average of eight capital cities Percentage Change (from previous financial year) 2002-03 2.8 3.3 3.2 4.0 2.8 3.3 2.3 3.3 3.1 2003-04 2.1 2.2 2.9 3.0 2.0 2.5 1.4 2.6 2.4 2004-05 2.5 2.0 2.6 2.3 3.2 3.2 2.2 2.3 2.4 2005-06 3.0 3.1 3.2 3.2 4.2 3.2 3.3 3.5 3.2 Percentage Change (from corresponding quarter of previous year) 2002 September 3.1 3.1 3.7 3.7 3.3 3.5 2.2 3.7 3.2 December 2.8 3.1 3.0 3.6 2.9 3.1 2.0 3.2 3.0 2003 March 3.0 3.6 3.4 5.0 2.8 3.6 2.8 3.8 3.4 June 2.4 2.9 2.7 3.7 2.1 2.8 2.1 2.6 2.7 September 2.0 2.9 2.9 3.6 2.1 2.6 1.8 2.8 2.6 December 2.3 2.2 3.1 3.3 2.1 2.9 1.7 2.7 2.4 2004 March 2.0 1.8 2.5 2.1 1.6 2.1 1.1 2.3 2.0 June 2.3 2.1 3.2 3.0 2.6 2.5 1.2 2.9 2.5 September 2.7 1.7 2.4 2.5 2.5 2.8 2.2 2.5 2.3 December 2.6 2.3 2.6 2.6 2.9 3.3 1.9 2.4 2.6 2005 March 2.2 2.0 2.6 2.2 3.4 3.5 2.1 2.2 2.4 June 2.4 2.1 2.5 2.2 3.8 3.1 2.6 2.1 2.5 September 2.9 3.1 2.8 3.0 4.1 3.5 2.8 2.9 3.0 December 2.5 2.7 2.8 2.7 4.0 2.9 3.0 3.1 2.8 2006 March 2.7 2.8 2.9 3.1 4.2 2.8 3.4 3.5 3.0 June 3.8 3.9 4.1 3.8 4.7 3.5 4.2 4.8 4.0 September 3.7 3.4 4.4 3.8 4.8 3.3 4.9 4.2 3.9 Percentage Change (from previous quarter) 2002 September 0.6 0.7 0.8 0.9 0.9 0.4 0.3 0.7 0.7 December 0.6 0.9 0.5 0.9 0.4 0.4 0.6 0.8 0.7 2003 March 1.2 1.4 1.4 2.2 0.7 1.4 1.0 1.1 1.3 June 0.1 0.0 0.0 -0.2 0.0 0.6 0.3 0.0 0.0 September 0.1 0.6 1.1 0.8 0.9 0.2 -0.1 0.9 0.6 December 0.8 0.2 0.6 0.6 0.4 0.6 0.5 0.7 0.5 2004 March 1.0 1.0 0.8 1.0 0.3 0.7 0.4 0.7 0.9 June 0.3 0.3 0.6 0.6 1.0 0.9 0.4 0.6 0.5 September 0.5 0.2 0.3 0.3 0.7 0.5 0.9 0.5 0.4 December 0.8 0.8 0.8 0.7 0.9 1.2 0.2 0.5 0.8 2005 March 0.6 0.8 0.8 0.6 0.8 0.9 0.6 0.5 0.7 June 0.5 0.3 0.5 0.6 1.3 0.5 0.9 0.5 0.6 September 1.0 1.2 0.6 1.1 1.0 0.9 1.0 1.3 0.9 December 0.3 0.4 0.8 0.5 0.8 0.6 0.5 0.8 0.5 2006 March 0.8 0.9 0.9 1.0 1.0 0.8 0.9 0.9 0.9 June 1.6 1.4 1.8 1.3 1.8 1.2 1.7 1.8 1.6 September 0.9 0.7 0.8 1.1 1.1 0.7 1.7 0.7 0.9 Back to top LONGER TERM SERIES: CPI All Groups, Weighted Average of Eight Capital Cities, Index Numbers(a) Quarter ending Year 31 March 30 June 30 September 31 December 1985 68.1 69.7 71.3 72.7 1986 74.4 75.6 77.6 79.8 1987 81.4 82.6 84.0 85.5 1988 87.0 88.5 90.2 92.0 1989 92.9 95.2 97.4 99.2 1990 100.9 102.5 103.3 106.0 1991 105.8 106.0 106.6 107.6 1992 107.6 107.3 107.4 107.9 1993 108.9 109.3 109.8 110.0 1994 110.4 111.2 111.9 112.8 1995 114.7 116.2 117.6 118.5 1996 119.0 119.8 120.1 120.3 1997 120.5 120.2 119.7 120.0 1998 120.3 121.0 121.3 121.9 1999 121.8 122.3 123.4 124.1 2000 125.2 126.2 130.9 131.3 2001 132.7 133.8 134.2 135.4 2002 136.6 137.6 138.5 139.5 2003 141.3 141.3 142.1 142.8 2004 144.1 144.8 145.4 146.5 2005 147.5 148.4 149.8 150.6 2006 151.9 154.3 155.7 (a) Base of each index:1989-90 = 100.0