Hong Kong consumer prices data for the month of September is set to be released this week. According to a DBS Bank research report, the headline inflation is likely to have accelerated to 2.4 percent year-on-year in September from August’s 2.3 percent.
Solid domestic economic conditions in the first half of this year and the feed through of higher rents over the past year should uphold inflationary pressures. The widespread port disease and rise in vegetable price in China might also have stimulated imported food costs. Nevertheless, pressure on overall import prices is expected to have remained at moderate level because of a strengthening US dollar and weakening CNY.
The launch of new government subsidies will continue to keep the price pressure at bay, added DBS Bank.