Hong Kong Inflation Rate Unchanged in March

Hong Kong annual consumer prices rose 3.9 percent in March of 2014, the same rate recorded in February. In the first quarter of 2014, the inflation rate rose by 4.2 percent over a year earlier. The corresponding increase after netting out the effects of all Government's one-off relief measures was 3.8 percent.

Year-on-year, increases in prices were recorded in March for alcoholic drinks and tobacco (7.2 percent, mainly due to the increase of tobacco duty); housing (5.4 percent); electricity, gas and water (4.8 percent); food (excluding meals bought away from home) (4.8 percent); meals bought away from home (4.4 percent); miscellaneous goods (3.3 percent); miscellaneous services (2.8 percent); clothing and footwear (2.5 percent) and transport (1.5 percent).

On the other hand, year-on-year decrease in prices was recorded for durable goods (-3.0 percent).

A Government spokesman said that inflationary pressures eased slightly in recent months.  The underlying inflation in the first quarter of this year, averaging 3.8 percent, was lower than that of 4.0 percent in the fourth quarter of last year.  Of particular note was the slower private rental increase in the housing component.  Nevertheless, the lower underlying inflation rate in March compared with the average rate in January and February was due partly to the year-on-year decline in the costs of package tours, which resulted from a high base of comparison as the Easter holidays fell in late March last year but in mid-April this year.

The spokesman commented further that, looking ahead, the continued feed-through of the milder increases in fresh-letting residential rentals since early 2013 as well as the modest imported inflation should help contain inflation in the near term.

Hong Kong Inflation Rate Unchanged in March

Census and Statistics Department | Joana Taborda | joana.taborda@tradingeconomics.com
4/22/2014 9:54:40 AM