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Exchange rate movements and consumer prices: some perspectives

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Abstract

Economic developments in the rest of the world affect New Zealand consumer prices. This article traces the channels through which the consumers price index (CPI) is affected by the exchange rate. Changes in the exchange rate that result from changes in the prices of commodities New Zealand exports appear to have had materially different inflationary implications than other changes in the exchange rate.

Suggested Citation

  • Miles Parker, 2014. "Exchange rate movements and consumer prices: some perspectives," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 77, pages 31-41, March.
    • Handle: RePEc:nzb:nzbbul:mar2014:03
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    File URL: http://www.rbnz.govt.nz/-/media/ReserveBank/Files/Publications/Bulletins/2014/2014mar77-1parker.pdf
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    References listed on IDEAS

    as
    1. Miles Parker & Benjamin Wong, 2014. "Exchange rate and commodity price pass‐through in New Zealand," Reserve Bank of New Zealand Analytical Notes series AN2014/01, Reserve Bank of New Zealand.
    2. Richard Fabling & Lynda Sanderson, 2015. "Export Performance, Invoice Currency and Heterogeneous Exchange Rate Pass-through," The World Economy, Wiley Blackwell, vol. 38(2), pages 315-339, February.
    3. Hellerstein, Rebecca, 2008. "Who bears the cost of a change in the exchange rate? Pass-through accounting for the case of beer," Journal of International Economics, Elsevier, vol. 76(1), pages 14-32, September.
    4. Tim Hampton, 2001. "How much do import price shocks matter for consumer prices?," Reserve Bank of New Zealand Discussion Paper Series DP2001/06, Reserve Bank of New Zealand.
    5. Linda S. Goldberg & José Manuel Campa, 2010. "The Sensitivity of the CPI to Exchange Rates: Distribution Margins, Imported Inputs, and Trade Exposure," The Review of Economics and Statistics, MIT Press, vol. 92(2), pages 392-407, May.
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    Cited by:

    1. Miles Parker, 2014. "How much of what New Zealanders consume is imported? Estimates from input-output tables," Reserve Bank of New Zealand Analytical Notes series AN2014/05, Reserve Bank of New Zealand.
    2. Fazal, Rizwan & Rehman, Syed Aziz Ur & Bhatti, M. Ishaq, 2022. "Graph theoretic approach to expose the energy-induced crisis in Pakistan," Energy Policy, Elsevier, vol. 169(C).
    3. Miles Parker & Benjamin Wong, 2014. "Exchange rate and commodity price pass‐through in New Zealand," Reserve Bank of New Zealand Analytical Notes series AN2014/01, Reserve Bank of New Zealand.
    4. Daan Steenkamp, 2014. "Structural adjustment in New Zealand since the commodity boom," Reserve Bank of New Zealand Analytical Notes series AN2014/02, Reserve Bank of New Zealand.

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