Hong Kong’s consumer price inflation eases in September

Hong Kong’s CPI inflation slowed in September after surging in August. According to the Census and Statistical Department, the nation’s consumer price inflation eased to 2.7 percent year-on-year, as compared with August’s 4.3 percent, which was the strongest rate in 17 months.  The rise in August rate was due to the low base effect arising from the government’s payment of public housing rentals in August 2015.

Excluding the effects of all government’s one-off relief measures, the underlying inflation rate came in at 2.3 percent in September, as compared with August rate of 2.1 percent, predominantly because of the upward adjustment in public housing rentals, added the Census and Statistical Department.

Looking at various CPI components, annual rise in prices were seen in electricity, gas and water, which rose 10.3 percent, mostly due to the low base effect resulting from the special fuel rebate in electricity beginning from mid-August 2015. Housing rose 4.2 percent, whereas alcoholic drinks and tobacco and food prices were up 2.2 percent each. Transport charges grew 1.7 percent.

The CPI inflation in the third quarter grew 3.1 percent year-on-year. Excluding the one-off relief measures, the index rose 2.1 percent. A government spokesman stated that the underlying inflation for the third quarter as a whole eased further from the second quarter.

“Looking ahead, inflation risks should remain contained in the near term, given the subdued global inflation as well as moderate local cost pressures. The Government will continue to monitor the inflation developments closely, particularly its impact on the lower-income people”, added the spokesman.