Hong Kong’s headline inflation slows in April, inflationary pressures likely to go up in 2018

Hong Kong’s headline consumer price inflation rose 1.9 percent year-on-year in April, a slowdown from 2.6 percent seen in the prior month, showed the Census and Statistics Department. Netting out the effects of all Government’s one-off relief measures, the year-on-year rate of rise in the Composite CPI in April 2018 was 2.2 percent. This rise is smaller than the one recorded in March, mainly because of the smaller rises in the charges for package tours and the prices of fresh vegetables.

On a seasonally adjusted basis, the average monthly pace of rise in the composite CPI for the three-month period from February to April came in at 0.2 percent, and that for the three-month period from January to March 2018 was 0.3 percent. Stripping the effects of all Government’s one-off relief measures, the average month pace of rise in the CPI for the three-month period to April came in at 0.3 percent, the same as that for the three-month period from January to March 2018.

Food inflation rose on a year-on-year basis, along with electricity, gas and water, housing, miscellaneous goods, miscellaneous services, clothing and footwear, transport and alcoholic drinks and tobacco. Meanwhile, durable goods saw a fall on a year-on-year basis in April.

A government spokesman commented that, looking ahead, inflationary pressures might go up over the course of 2018 if the strong economic conditions continue. The feed-through of the rise in fresh-letting residential rentals over the past year or so would also likely become more visible in the period ahead.

“Nonetheless, the inflation rate should remain within a moderate range in the near term. The Government will continue to monitor the inflation developments closely, particularly the impact on the lower-income people”, added the spokesman.

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