TREND OF PRICES

Dominion, Volume 26, Issue 163, 5 April 1933, Page 10

TREND OF PRICES

Fall in Export Values

LOWER THAN IN 1914

Exchange and Sales-Tax

WHAT STATISTICS REVEAL

Figures in the March number of the monthly issue of the Abstract of Statistics show 'that export prices for February are 19.4 per cent- be ‘ low prices ruling in 1914. The. index number of dairy produce prices for February shows a fall of 0.7 pel cent, when compared with prices ioi December last.

In referring to retail prices, the Abstract stated the Dominion weighted average index number of retail prices as . : February 15 was <97 (on fte base: average prices ruling during 192630=1000), an increase of 26.9 per cent, over July, 1914, prices. The latest allgroups index showed a decrease of 1.1 per cent., as compared with the immediately preceding figure, which related to prices on November 15, 1932. Food prices were, on the average, 2.B'per cent, higher on February 15 than on the corresponding day in January. The increases in the index numbers for the individual groups included in the combined food groups index were: Groceries, 2.7 per cent.; dairy produce, 6.4 per cent.; and meat, 0.4 per cent. As compared with November 15, 1932, however (the latest date prior to February, 1933, for which the all-groups index was available), food prices on February 15 showed on the average a decrease of 2.4 per cent. The index number of house rents on February 15 showed a fall of 5.2 per cent, since the previous collection (in August, 1932) and an increase of 44.7 per cent, over the July, 1914, index. Drapery and Footwear. The Index number for the clothing, drapery, and footwear group had increased by 1.8 per cent, since November 15, 1932, while that for the miscellaneous group had advanced by 1.7 per cent. The increase over July, 1914, prices was 16.3 per cent, in the former case and 61.6 per cent, in the latter. “It, seems desirable,” the Abstract continues, “to point out that the final effect of the imposition of the sales tax, and, to a lesser extent, of the raising of the exchange rate, would not be reflected in the retail price index numbers as at February 15. In several instances, particularly in the clothing and miscellaneous groups, firms which showed no increases in retail prices indicated that this was due to the fact that there had been no recent replacement of stocks. On the other hand, many of the increases which'had been made by February 15 were, no doubt, tentative and would be revised (upward or downward) when the ultimate effect of the imposts became apparent?’ Wholesale Prices. Discussing wholesale prices, the Abstract states the general index number of wholesale prices (on the base: average prices ruling during 1909-13= 1000) for February was 1315, an increase of 24.9 per cent, over the index for the year 1914. An increase of 3.3 per cent, had been recorded jsince December, 1932. On analysis into locally produced and Imported items, it was found that locally produced items had fallen on the average by 7.2 per cent, since December, extremely low prices ruling for potatoes and onions, together with a reduction in oats, wheat, and flour prices, more than offsetting increases in wholesale prices of butter, wool, and meat. The index number for imported commodities, however, had risen by 15.4 per cent, since December last; the effects of the imposition of the sales tax and (for certain commodities) the raising of the exchange rate being reflected in wholesale prices earlier and perhaps more fully than in retail. The general index number of export prices for the month of February, 1933 (on the base: average export prices ruling during 1909-13= 1000) was 878, a decrease of 19.4 per cent, as compared with export prices ruling during the year 1914. ,In view of the interest attaching to a comparison with the last complete month preceding the increase in the exchange rate a table showing export price indexes for the more important groups in December, 1932, and February, 1933, was.given:—

Commenting on this table, the Abstract stated the index number of dairy produce prices had fallen by 0.7 per cent., the influence of the increased exchange rate being insufficient to counteract a fall in sterling prices. The index number for the meat group had increased by 0.7 per cent, since December, 1932, while that for wool has advanced by 22.0 per cent.- In connection with the latter increase it should be noted that the December, 1932, index for this group (527) was exceptionally low. the November, 1932, index having been 73 points higher (600). The index number covering all pastoral and dairy produce had increased by 6.5 per cent, since December, while that for, all groups combined has increased by 6.8 per cent.

Index J Dee., f umbers. Feb., Group. Dairy produce 1932. 839 1933. . 833 t 0.7 Meat 1087 1192 * 9.7 Wool 527 643 *22.0 Other pastoral (luce .... proG17 589 AH pastoral and dairy produce . 790 851 * 6.5 All groups ... 822 878 * 6.8 •Increase. jDecrease.