Hong Kong Inflation Rate at 5-Month Low of 2.4%


The annual inflation rate in Hong Kong dropped to 2.4 percent in January 2019 from 2.5 percent in the previous month. It stands at the lowest level since August, amid falling prices of electricity, gas and water due to the Government's electricity subsidy starting from January 2019. Also, cost slowed mainly for miscellaneous services.

Year-on-year, prices declined for electricity, gas and water (-4.6 percent vs 3.8 percent in December), mainly due to the Government's provision of electricity charge subsidy starting from January 2019. Meantime, cost slowed mainly for miscellaneous services (2.9 percent vs 3.4 percent), as prices rose less for educational services (2.3 percent vs 2.5 percent) and fell further for information & communication services (-6.4 percent vs -6.2 percent).

In contrast, inflation rose for food (3.3 percent vs 2.9 percent), including food excluding meals bought away from home (4.2 percent vs 3.8 percent) and meals bought away from home (2.7 percent vs 2.5 percent); housing (3.0 percent vs 2.9 percent), namely private rent (2.3 percent vs 2.2 percent); transport (2.3 percent vs 1.8 percent); alcoholic drinks and tobacco (3.1 percent vs 2.8 percent); and miscellaneous goods (1.3 percent vs 1.2 percent). In addition, prices rebounded for clothing & footwear (0.3 percent vs -1.5 percent).

On a monthly basis, consumer prices edged down 0.2 percent after increasing 0.4 percent in the previous month.

Underlying consumer inflation, which excludes the effects of one-off government relief measures - such as tax cuts for lower income individuals; extra allowance for the elderly, child & disabled people; students' grants; etc. -, was at 3.0 percent, slightly higher than 2.9 percent in the prior month.

A Government spokesman commented that, in the near term, the upside risks to inflation should remain contained. "The recent moderation in fresh-letting residential rentals could have a mitigating effect in the months ahead. The moderating global economic growth and the earlier strengthening of the US dollar vis-à-vis other major currencies should help keep external price pressures in check. The Government will continue to monitor the inflation developments closely, particularly the impact on the lower-income people."

Hong Kong Inflation Rate at 5-Month Low of 2.4%


Census and Statistics Department | Luisa Carvalho | luisa.carvalho@tradingeconomics.com
2/22/2019 9:25:16 AM