According to a recent announcement made by the Statistics New Zealand (SNZ), the capital goods price index (CGPI) filed a rise of close to 0.4 per cent in the September quarter.

It is to be mentioned here that it is the largest quarterly increase since the March 2009 quarter. In fact, experts are of a view that the momentum will continue in the times to come as well. It may be noted here that the CGPI measures the change in the price of physical capital goods purchased by producers of goods and services.

For the record, the government agency named three major contributors for the CGPI increase with the first being the residential buildings index that went up 0.4 per cent.

Market watchers believe that it was reflecting higher dwelling and out-building prices. Moreover, the construction index filed a rise of about 0.8 per cent, which was largely due to higher raw material costs for constructing infrastructure such as pipelines and roads.

And the plant, machinery and equipment index moved up by around 0.3 per cent, which showed higher raw material costs and a depreciation of the New Zealand dollar.