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| Information about the Food Price Index |
Availability
| Valid From: .. | 07/18/2006 |
| To: .. | Ongoing |
| Frequency: .. | Monthly |
Design
Purpose: Food is the only commodity group of the Consumers Price Index (CPI) for which an index is prepared each month.
General Information ..1. What is a price index?
A price index shows how a set of prices has changed between time periods. In the case of the FPI, prices of a representative range of food items are surveyed each period at a sample of outlets in main urban areas. The average price level of goods and services in the expression base period is conventionally expressed in comparison to an index base reference value of 1000. This is the benchmark to which prices in other periods are compared. Thus, if the index number for a period is 1150, prices have increased by 15.0 percent since the base period. Similarly, if the index number for a period is 950, then prices have fallen by 5.0 percent since the base period.
Changes in the level of a price index are calculated by weighting the changes in the surveyed prices of a particular set of items. The set of items represents the basket of goods and services that the index purports to measure. Item (expenditure) weights are estimates of the overall significance of each of the different items in the basket.
The FPI is a price index that measures changes in the level of prices of a basket of goods representative of food commodities purchased by private households in the base year of the index. The basket represents the average expenditure pattern of the index population in the base period. The representativeness of the basket of goods, however, is likely to reduce over time.
2. Reference population
The population coverage of the FPI relates to the expenditure of private, New Zealand-resident households living in permanent dwellings. The reference population covers approximately 98 percent of the usually-resident population. There are no exclusions based on income source or geographic location.
The target population for the Household Economic Survey (HES) mirrors the reference population for the CPI. The HES excludes residents of temporary dwellings and households in very remote parts of the North and South Islands and on offshore islands, including Great Barrier, Kawau, Stewart and the Chatham Islands.
3. Weights
Weights show the relative importance of an item to the overall set of items.
Expenditure weights
Expenditure weights are derived mainly from the HES and are updated every three years, the current base period being June 2006. The weights calculated are based on only the most recently available annual expenditure patterns (i.e. the most recent HES and other relevant survey results).
Outlet weights
As it is not practical to survey prices from every possible outlet, a selection of outlets are priced and outlet weights used to combine the prices collected from each. Outlet weights are used for items within four of the five subgroups (reastaurant meals and ready-to-eat foods subgroup being the exception, where quotes are equally weighted).
Household Economic Survey Data on expenditure by storetype is used to weight prices collected at convenience stores, service stations, butchers, fish shops and supermarkets. For example if supermarkets sell four times as much meat as butchers, the price movement of meat in supermarkets will have four times the impact on the overall price movement for meat as the price movement for butchers.
Further, Retail Trade Survey data is used to weight supermarket store chains relative to each other for combining prices collected at supermarkets.
Population weights
Regional indexes, for each of the 15 regions where prices are surveyed, are combined to calculate a New Zealand FPI using population weights. Each region is assumed to have the same spending pattern i.e. the same goods and services are price-surveyed in each region.
The population of each regional council area (or a proportion of it) is assigned to the most appropriate of the 15 urban areas priced in the FPI, taking the following factors into account:
- population distribution within the area and natural geographic boundaries
- the centres in which the population of the local authorities purchase their goods and services (major durables and services not available in smaller centres particularly)
- the location of wholesalers and distributors from which stores in the local authority area obtain stocks.
4. Pricing
How is it decided which items to price?
An accurate measure of the overall level of price change can be calculated by periodically surveying the prices of a representative sample of goods and services. The sample is selected taking into account
- the sample must represent the range of commodities purchased by private New Zealand households;
- price movements must be typical of the range of commodities the item represents;
- it must be practical to survey prices for the selected commodities at regular intervals over the life of the index;
- the price of each commodity of the same quantity and quality must be surveyed each period (otherwise prices will be adjusted);
- price surveys should occur frequently to ensure that price changes register in the index in a timely manner.
Where are prices collected?
Prices are surveyed for all the goods and services selected for the FPI. This generally takes place in the 15 main urban areas which are:
Whangarei | Auckland | Hamilton |
Tauranga | Rotorua | Napier/Hastings |
New Plymouth | Wanganui | Wanganui |
Wellington | Nelson | Christchurch |
Timaru | Dunedin | Invercargill |
Prices are collected in a wide range of outlets since most items are sold in more than one type of outlet. For example an apple, from a fruit and vegetable shop, a supermarket or a dairy. The rate of price change will usually vary between these outlets. HES and retail trade data are used as a guide to determine which outlets to price survey for a particular commodity.
How are prices collected?
Most prices are collected by personal visits by Statistics New Zealand (Statistics NZ) field collections staff. This is a time consuming and resource intensive task, however the complexity of obtaining accurate prices means that it is impractical to collect the prices by postal survey. During pricing any changes in quality or quantity are noted by staff and discussed with the retailer. This method places lower burden on the respondent than a postal survey.
When are prices collected?
Most items are priced at the mid-point of each month. Fresh fruit and vegetable prices, which are extremely volatile, are collected weekly.
5. Ongoing maintenance of the CPI
Out of stock items
At times, the items priced are not available as they may be temporarily out of stock or permanently removed from sale. If an item is removed from sale from an outlet, then it will be priced where possible in a similar outlet. When it is no longer available, or another item is clearly more popular, it will be replaced.
If an item is temporarily out of stock the price is carried forward from the previous period. Carrying forward can occur for a number of pricing periods depending on the frequency of the price survey. After a specified number of times the outlet or item will be replaced.
Outlet replacement
The replacement of an outlet can occur for a number of reasons. The most common are when an outlet closes or is taken over, when stocks are run down, or the item priced is no longer available on a regular basis.
If an outlet needs to be replaced, then another outlet of the same or similar type and in the same area is chosen.
If a chainstore outlet closes in a particular region, then it is either replaced by another store of the same chain or, if no other store exists, the chain is dropped from the survey in that region. If an independent outlet closes, it is replaced by another independent outlet of a similar nature.
If an outlet no longer stocks a priced item, or if it is noticed that stocks are continually run down, then depending on the circumstances, a replacement outlet is found.
When a new chain opens in a region, it is included in the outlet sample so that each chain of that particular type in the region is represented. Before such an outlet can be introduced into the sample its market share must be known so that an outlet weight can be calculated. A new outlet often introduces price instability as consumers respond to promotional activities and trial the new outlet. Hence new outlets are only introduced to the FPI when reliable pricing and weighting information is available.
Quality control
The aim of the FPI is to measure the price change in identical items over time. Any price movement due to a change in quality should be excluded from the FPI so that the true price change excluding all other factors is measured.
In practice, it is not always possible to price the same items over time. Restaurants regularly change menu items and there are occurrences of "fad food" items which are no longer produced. In these cases a change in quality may occur when a substitute item is introduced.
Quality assessments are done to put a monetary value on the change in value as perceived by the consumer between the old and new item. Prices are then adjusted so that no price change is shown that is related to the change in quality.
Seasonal adjustment
Prior to June 2006, fresh fruit and fresh vegetable items that exhibited a seasonal pattern were adjusted to remove the effect of normal seasonal change. This treatment was used to reduce the influence of normal seasonal price fluctuations. However, the treatment does not completely eliminate the effects of seasonal fluctuations if shifts in seasonal patterns occur. Food is the only group in the CPI in which seasonal adjustment was applied.
From June 2006 onwards, the FPI will incorporate seasonally unadjusted prices for fresh fruit and fresh vegetables. This is in line with a recommendation made by the 2004 CPI Revision Advisory Committee. The ongoing, fully unadjusted FPI is linked at June 2006 to the previously published FPI, which is partly seasonally adjusted. As such, annual movements calculated over the annual period encompassing the June 2006 month will be based on fully unadjusted index numbers for the latest month compared with partly adjusted index numbers for the same month of the previous year.
6. Elemenatry aggregate formulae
The 'geometric mean of price relatives' (or Jevons) formula is used to calculate average prices for all goods and services in the basket, except for fresh fruit and fresh vegetables. The Jevons formula is:
In practice, Statistics New Zealand uses a weighted geometric mean formula, with the weights, where available, representing the relative importance of outlet types such as supermarkets relative to convenience stores and the relative importance of individual outlets (eg supermarket chains).
The Dutot formula will continue to be used for fresh fruit and fresh vegetables, as the first stage of aggregation is across both outlets within each region and across weeks within each month. The Dutot formula is:
In practice, Statistics New Zealand uses a weighted arithmetic mean formula, with the weights, where available, representing the relative importance of outlet types such as supermarkets relative to convenience stores, and the relative importance of individual outlets (eg supermarket chains).
The Dutot formula assumes that households purchase the same quantities at each surveyed outlet in each period. By comparison, the Jevons formula assumes that households spend the same amount at each surveyed outlet in each period. This implies that increased quantities are purchased from outlets showing lower-than-average relative price change and decreased quantities from outlets showing higher-than-average price change. Use of the Jevons formula is recommended by the International Labour Office for goods and services where households are able to substitute towards outlets showing lower relative price change.
7. Index formulae
The index is calculated using the price relative form of the base weighted Laspeyres formula.
Laspeyres index
Where Pit = Price of item i (i = 1,.....,m) in period t
Pio = Price of item i (i = 1,.....,m) in the base period
Qio = Quantity of item i purchased in the base period
The Laspeyres index measures the change in cost of purchasing the same basket of goods and services in the current period as was purchased in the specified base period. The prices are weighted by quantities in the base period.
The price relative form of the Laspeyres index is used by many statistical agencies around the world. Statistics NZ adopted this form in the major revision of 1993 and use it in all aggregations above the calculation of regional price data.
Laspeyres price relative index formula
Where Pit = Price of item i (i = 1,.....,m) in period t
Pio = Price of item i (i = 1,.....,m) in the base period
Eio = Expenditure on item i purchased in the base period
= PioQio
It produces the same results as the basic Laspeyres formula but means that expenditure data from the HES can be used directly in the index formula.
Weekly and monthly pricing questionnaires are used.
Output Variables
Output variables are pieces of individual information that can be extracted from the survey/output data. Often output variables can be cross tabulated with other output variables, for example sales by industry classification. The list below contains all current and past output variables which have been released for this survey/output.
Output variables are pieces of individual information that can be extracted from the survey/output data. Often output variables can be cross tabulated with other output variables, for example sales by industry classification. The list below contains all current and past output variables which have been released for this survey/output.
The most comprehensive source of published FPI data is Statistics NZ’s computerised time-series database, INFOS. This is an on-line statistical service which can be accessed from a growing number of private and public computer terminals throughout the country.
The term "Food Price Index" is understood to refer to the monthly, 15 urban areas combined index number. The current expression base is the June 2006 month (=1000) for the monthly FPI.
The FPI encompasses a multidimensional matrix of sub-indexes that are aggregated for a variety of combinations of geographical areas. Indexes are calculated for one group, five subgroups, 14 Classes, 60 sections, 68 subsections, 141 items and 154 sub-items. The following tables detail the indexes available on INFOS and their frequency. Other publications contain a less comprehensive range of FPI indexes.
Extract from the INFOS Index of the database listing series.
Food Price Index for New Zealand (monthly)
| Identifier | Description |
| CPIM.SE901 | Food |
Food Price Index Subgroups for New Zealand (monthly)
| Identifier | Description |
| CPIM.SE9011 | Fruit and vegetables |
| CPIM.SE9012 | Meat, poultry and fish |
| CPIM.SE9013 | Grocery food |
| CPIM.SE9014 | Non-alcoholic beverages |
| CPIM.SE9015 | Restaurant meals and ready-to-eat food |
Food Price Index Classes for New Zealand (monthly)
| Identifier | Description |
| CPIM.SE901101 | Fruit |
| CPIM.SE901102 | Vegetables |
| CPIM.SE901201 | Meat and poultry |
| CPIM.SE901202 | Fish and other seafood |
| CPIM.SE901301 | Bread and cereals |
| CPIM.SE901302 | Milk, cheese and eggs |
| CPIM.SE901303 | Oils and fats |
| CPIM.SE901304 | Food additives and condiments |
| CPIM.SE901305 | Confectionery, nuts and snacks |
| CPIM.SE901306 | Other grocery food |
| CPIM.SE901401 | Coffee, tea and other hot drinks |
| CPIM.SE901402 | Soft drinks, waters and juices |
| CPIM.SE901501 | Restaurant meals |
| CPIM.SE901502 | Ready-to-eat food |
Food Price Index selected monthly groupings
| Identifier | Description |  |
| CPIM.SE9NS3000 | Fresh fruit and vegetables | |
| CPIM.SE9NS3001 | Fresh fruit | |
| CPIM.SE9NS3002 | Fresh vegetables | |
| CPIM.SE9NS3010 | Food group less fresh fruit and vegetables | |
| CPIM.SE9NS3080 | Food - seasonally unadjusted | |
| CPIM.SE9NS3081 | Fruit and vegetables - seasonally unadjusted | |
| CPIM.SE9NS3082 | Fruit - seasonally unadjusted | |
| CPIM.SE9NS3083 | Fresh fruit - seasonally unadjusted | |
| CPIM.SE9NS3084 | Vegetables - seasonally unadjusted | |
| CPIM.SE9NS3085 | Fresh vegetables - seasonally unadjusted | |
| CPIM.SE9NS3086 | Fresh fruit and vegetables - seasonally unadjusted | |
Food Price Index by Broad Regions (monthly)
| Identifier | Description |
| CPIM.SE101 | Auckland |
| CPIM.SE201 | Wellington |
| CPIM.SE301 | Rest of North Island |
| CPIM.SE401 | North Island |
| CPIM.SE501 | Canterbury |
| CPIM.SE701 | South Island |
| CPIM.SE601 | Rest of South Island |
Food Price Index by Separate Regions (monthly)
| Identifier | Description |
| CPIM.SEA01 | Whangarei |
| CPIM.SEB01 | Auckland |
| CPIM.SEC01 | Hamilton |
| CPIM.SED01 | Tauranga |
| CPIM.SEE01 | Rotorua |
| CPIM.SEF01 | Napier-Hastings |
| CPIM.SEG01 | New Plymouth |
| CPIM.SEH01 | Wanganui |
| CPIM.SEI01 | Palmerston North |
| CPIM.SEJ01 | Wellington |
| CPIM.SEK01 | Nelson |
| CPIM.SEL01 | Christchurch |
| CPIM.SEM01 | Timaru |
| CPIM.SEN01 | Dunedin |
| CPIM.SEO01 | Invercargill |
Changes in Output Variables over time
Guide to Interpreting Data
Summary of Changes to Survey/Output ..July 2006 Review of the Food Price Index
Introduction
A periodic review of the FPI, undertaken as part of a wider review of the Consumers Price Index (CPI), was implemented with the publication of the July 2006 FPI.
This review involved the reselection of the basket of representative food goods and services, and the reweighting of the basket to better reflect the relative importance of household spending on food. In addition, the sample of retail outlets that prices are collected from has been updated. A new expenditure classification system was also introduced and the 'elementary aggregate' formula used to calculate lower-level indexes reviewed.
New classification system
A new classification system, based on the United Nations' Classification of Individual Consumption According to Purpose and adapted to suit New Zealand conditions, has been developed by Statistics New Zealand. The new classification system, the New Zealand Household Expenditure Classification (NZHEC), is being used for the rebased FPI and CPI.
The new classification down to the third level, and the expenditure weight associated with each category, is given in Table 5 of the FPI release. Care should be taken when comparing the 2002 weights with the 2006 weights. The 2002 weights for the old classification system have been reclassified to the new NZHEC classification. There are some differences in the way the weights were aggregated in 2002 from the way they have been aggregated in 2006, due to the use of different classification systems.
Review of food goods and services in the basket
Ten new food items have been added to the basket. These include:
- frozen complete meals
- bottled water
- canned tomatoes
- beans
- parsnips
- spring onions
- frozen fish fillets (replaces frozen fish fingers)
- pork roasts (replaces pork strips)
- dried herbs (replaces peppercorns)
- canned soup (replaces soup powder).
Additionally, takeaway soup has been removed from the basket.
The pricing specifications for all the food goods and services in the FPI basket have also been reviewed, to ensure that surveyed varieties and sizes are representative of household purchases. For some types of food, additional specifications such as calcium-enriched milk, ground coffee and bottled orange juice have been added, complementing existing more traditional ones such as standard homogenised milk and instant coffee.
Expression base
The July FPI is the first index published on a new expression base of the June 2006 month (=1000). Previous series were published on a base of the June 1999 month (=1000). For categories under the new expenditure classification that have equivalent indexes under the old classification system, the previously published percentage changes for periods up until the June 2006 month have been preserved by scaling the index numbers so that the June 2006 month is set to 1000. For categories with no equivalent existing series, a new time series has been calculated back to the June 1999 month.
Price movements for the updated and reweighted basket from the June to July 2006 months have been linked to the rescaled FPI at the June 2006 month.
Expenditure weights
The main source of information used to reweight the FPI basket was the 2003/04 Household Economic Survey (HES), which collected detailed information on the spending patterns of nearly 3,000 households. For food items where the HES is not considered to provide accurate information, such as confectionery and soft drinks, alternative information, such as supermarket scanner data obtained from ACNielsen, was used. The initial weights, for the year to June 2004 (the weight reference period), were 'price updated' to the June 2006 month (the price reference period). This involved expressing the underlying quantities of the weight reference period in the prices of the price reference period.
Table 5 of the FPI release gives the new expenditure weights, as at the June 2006 month, for the rebased FPI. The table also includes the June 2002 expenditure weights, reclassified using the new NZHEC classification system rather than the previously used classification system. Comparing the old and new classification systems at the subgroup level, the NZHEC meat, poultry and fish subgroup is equivalent to the old system's meat, fish and poultry subgroup. The NZHEC fruit and vegetables subgroup covers the same items as the old system's subgroup, with the exception of pasta sauces, which are classified under the NZHEC grocery food subgroup. A new subgroup, non-alcoholic beverages, draws on items previously classified under the old system's grocery food subgroup, and the restaurant meals and ready-to-eat food subgroup. Note, takeaway coffee, tea and milkshakes are classified under the NZHEC restaurant meals and ready-to-eat food subgroup.
Fruit and vegetables have a June 2006 expenditure weight of 13.55 percent, compared with 11.51 percent in June 2002. Total expenditure by households on both fruit and vegetables has increased, however, the relative weight for fruit has fallen. The increase in the expenditure weight for fruit and vegetables is partly due to improvements in the way grocery expenditure not further defined by households reporting in the HES was allocated across items in the FPI basket.
The share of the total food weight for meat, poultry and fish has fallen, to 16.22 percent. This is partly due to improvements in the way grocery expenditure not further defined by households in the HES was allocated across items in the FPI basket. Price increases since the last reweight for meat, poultry and fish have been lower than the overall price increases for food, which has also caused its share of the total food weight to fall.
The relative weight for grocery food (38.19 percent) has remained similar to its share of the total food weight in 2002.
The weight for non-alcoholic beverages (9.04 percent) has fallen, overall. The weight for coffee, tea and other hot drinks has increased slightly, while the weight for soft drinks, waters and juices has decreased, partly due to lower prices in the June 2006 month – which had an impact when weights were price updated.
There has been a strong increase in the overall weight for the restaurant meals and ready-to-eat food subgroup (23.00 percent compared with 21.14 percent in 2002). This reflects strong increases in spending by households on these types of items.
The FPI is no longer seasonally adjusted
Until the review, fresh fruit and fresh vegetable items have been adjusted to remove the effect of normal seasonal change. For the rebased FPI, seasonally unadjusted prices of fresh fruit and fresh vegetables in the basket are being used to calculate the FPI. The ongoing, fully unadjusted FPI has been linked to the partly adjusted, previously published FPI at the June 2006 month. This is in line with a recommendation made by the 2004 CPI Revision Advisory Committee to maintain the published time series, even though this may cause some short term disruption to users in interpreting annual movements. Fully seasonally unadjusted analytical series for the FPI are given in Table 3 of the FPI release. These analytical time series will provide annual movements on a fully unadjusted basis during the year-long transition of the official FPI, during which annual movements will be based on fully unadjusted index numbers for the latest month, compared with partly adjusted index numbers for the same month of the previous year.
Elementary aggregate formula
Prior to the review, the FPI used a 'ratio of arithmetic mean prices' (or Dutot) formula to combine surveyed prices at the first (or elementary) stage of aggregation. For the rebased FPI, the 'geometric mean of price relatives' (or Jevons) formula has been introduced for all goods and services in the basket, except for fresh fruit and fresh vegetables.
Usage and Limitations of the Data ..The FPI is a measure of food price change for households only, it should not be used or interpreted as an inflation measure for the economy as a whole.
Related Data Sources ..Directly: Consumers Price Index, indirectly: Producers Price Index
Sampling Errors ..Sampling error is a measure of the variability that occurs by chance because a statistically selected sample is surveyed rather than the entire population.
The FPI is based on a purposive sample of goods, services and outlets, not on a statistical sample. This means that judgement, rather than a statistical technique, was used to select the goods, services and outlets that are price surveyed. Due to the sampling methodology sample errors can not be calculated.
Non-sampling errors Non-sampling errors in the survey data may result from respondent error, mistakes made during the processing of survey results, non-response imputation and quality change. Statistics NZ adopts procedures to detect and minimise these types of errors but they may still occur. They are not quantifiable. One of the major areas of concern in this area is elimination of quality change.
Caveats on Release ..Caution should be used in making comparisons which span rebase periods as there are likely to be changes in weighting of items and new items introduced at these times.
Customised Output
Specific indexes for clients who are interested in the FPI e.g. an index for takeaways to be used by someone considering operating in the industry or potential investor in that sector etc.
Catalogue & Reference Numbers
Other Comments
Classification(s) used
Glossary of Terms
Acquisition approach
A conceptual base in which the expenditure weight for an item is based on the actual cost of a good or service acquired by households in the weighting base year, regardless of when the good is consumed or paid for.
The New Zealand CPI has been acquisition based since the 1974 revision.
Base period
The period at the beginning of the lifetime of a price index. The base period for the FPI is June 2006 month (=1000).
Basket of goods and service
The selection of goods and services represented in the FPI. The basket of goods and services selected for the New Zealand FPI is essentially fixed, i.e. the goods and services are selected in the base year, and remain more or less constant for the life of the index.
Dutot elementary aggregate formula
One of the three commonly used elementary aggregate formulae. At the initial aggregation of prices for a particular item, prices are combined as the 'ratio of arithmetic mean prices' :
In practice, Statistics New Zealand uses a weighted arithmetic mean formula, with the weights, where available, representing the relative importance of outlet types such as supermarkets relative to convenience stores, and the relative importance of individual outlets (eg supermarket chains).
Elementary aggregate
The initial aggregation of prices for a particular item. There are three formulae commonly used to calculate elementary aggregates: Carli (arithmetic mean of price relatives); Dutot (relative of arithmetic mean prices); and Jevons (geometric means). Statistics NZ uses both the Dutot and Jevons formulae.
Expenditure weight
Each item included in the basket of goods and services making up the FPI regimen is weighted according to its relative importance. These weights are based on expenditure information collected by Statistics NZ.
Fixed weight price index (or base weighted index)
A price index in which the quantity of an item purchased is assumed to be constant or fixed at the base period for the life of the index. The FPI is a fixed weight index. The life of the FPI is three years, i.e. weights are revised every three years.
General measure of inflation
A measure of the prevailing level of price change in an economy. It is designed to measure the market prices for goods acquired at a point in time by all transactors in the economy.
Household Economic Survey (HES)
Previously called the Household Expenditure and Income Survey (HEIS). A three yearly survey carried out by Statistics NZ which collects information on the spending patterns of private New Zealand households.
Index population (or reference population or target population)
The population covered by a price index. For the FPI, the index population is private resident households in New Zealand.
Inflation
An increase in the general or average level of prices of goods and services over a period of time.
Item weights
Estimates of the overall significance of each of the different items in the price index basket of goods and services.
Jevons elementary aggregate formula
One of the three commonly used elementary aggregate formulae. Use of the Jevons formula is recommended by the International Labour Office for goods and services where households are able to substitute towards outlets showing lower relative price change. At the initial aggregation of prices for a particular item, prices are combined as the 'geometric mean of price relatives':
In practice, Statistics New Zealand uses a weighted geometric mean formula, with the weights, where available, representing the relative importance of outlet types such as supermarkets relative to convenience stores and the relative importance of individual outlets (eg supermarket chains).
Laspeyres index
A price index measuring the changing cost over time of purchasing the same basket of commodities purchased in some historical period (the base period).
The Laspeyres index formula is given by:
Where Pit = Price of item i (i = 1,.....,m) in period t
Pio = Price of item i (i = 1,.....,m) in the base period
Qio = Quantity of item i purchased in the base period
An alternative Laspeyres index formula, used by Statistics NZ in the calculation of the FPI is given by the formula:
Where Pit = Price of item i (i = 1,.....,m) in period t
Pio = Price of item i (i = 1,.....,m) in the base period
Eio = Expenditure on item i purchased in the base period
= PioQio
National price
The average price of a good or service which is not aggregated up from regional prices.
e.g. motor vehicle registration is the same price nation-wide, i.e. it is a national price.
Non-representative expenditure
Expenditure not represented in the FPI. This exclusion may be for conceptual reasons, or for practical reasons.
Non-response
Non-response results when a respondent or group of respondents fails to provide information when contacted by the survey.
Non-sampling errors
Any error not resulting from the collection of information from a sample, rather than the whole population. The main non-sampling errors of interest to the reliability of the FPI are undercoverage; non-represented consumption; non-response and the practical limitations of collecting certain data.
Notional transaction
An estimate of a real transaction, not based on direct measurement.
Outlet
An individual, organisation or business enterprise from which goods or services may be purchased by householders and which can be price-surveyed.
Outlet sample
The outlets selected for purposive sampling.
Outlet type
A group of outlets which, for pricing purposes, is regarded as relatively homogeneous.
Outlet weights (or storetype weights)
A measure of importance (or weight) given to a particular type of shop (outlet) based on national expenditure patterns.
For example, many consumers tend to buy dairy products from supermarkets rather than other outlet types, hence a supermarket will have a higher outlet weight for cheese than a dairy. Outlet weights are applied to food and non-food groceries in the FPI.
Population weighting
A measure of importance of a particular FPI region based on the population of that region compared to the overall population. Population weights are used when combining regional information.
Price change measure
A measure of the changes in the prices of a set of items. This set of items could be all household expenditure as in the case of the CPI All Groups, or of a set of distinct transactions such as telecommunication charges.
Pricing centre
One of the 15 urban areas from which prices are collected for the calculation of the FPI.
Price deflators
Factors that, when applied to a related time series of values allows a valid comparison of the true underlying change free from the influence of price movements.
Price index
A numerical index indicating how a set of prices has changed between time periods.
Quality change
Any perceived difference in quality by the consumer for a good or service.
Reference population
See Index population.
Regimen
The selection of goods and services for which prices are surveyed for the purpose of compiling a price index. The goods and services covered by the FPI are classified into one group, five subgroups, 14 classes, 60 sections and 68 subsections, 141 items covering over 150 items.
Sample frame
A comprehensive list of all existing outlets (shops) from which a statistical sample can be selected.
Sampling error
Any error resulting from the collection of information from a sample, rather than the whole population.
Seasonal adjustment
Statistical technique to remove the seasonal pattern from prices or from the resultant price index so that the series is free from fluctuations due to seasonality. There are two methods of seasonal adjustment - concurrent seasonal adjustment and forward factors.
Seasonal commodity
A good or service with seasonal fluctuations in the quantity purchased throughout the year. These commodities may also, but not necessarily, have seasonal fluctuations in their price during the year.
Seasonal fluctuations (of a series)
Regular fluctuations that occur with the same magnitude at the same time every year.
Storetype weights
See Outlet weights.
Target population
The population which a survey aims to represent (e.g. resident private households in New Zealand).
Theoretical index bias
The cumulative difference, in one direction, between the actual level of price change experienced by consumers and the published FPI result, due to the construction of the price index. There are five types of theoretical bias: commodity substitution bias; outlet substitution bias; new goods bias; elementary index bias; and quality adjustment bias.
Trend (of a series)
The steady underlying long-term movement and shorter term movements in a series.
Under-coverage
A form of error which occurs when the sample frame from which a survey is selected does not completely cover the population of interest.
Contact Details
Liability
Statistics New Zealand gives no warranty that the information or data supplied contains no errors. However, all care and diligence has been used in processing, analysing and extracting the information. Statistics New Zealand shall not be liable for any loss or damage suffered by the customer consequent upon the use directly, or indirectly, of the information supplied in this product.
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