Hong Kong headline inflation slows slightly year-on-year in August, to remain in modest range in 2018

The Hong Kong consumer price inflation decelerated marginally in August to 2.3 percent year-on-year, showed the Census and Statistics Department. Stripping out the impacts of all Government’s one-off relief measures, the year-on-year pace of rise in the Composite CPI came in at 2.6 percent. The rise is slightly smaller than July’s 2.7 percent, owing to the smaller rises in the charges for package tours.

The average monthly pace of rise in the Composite CPI, on a seasonally adjusted basis, for the three-month period from June to August 2018 was 0.2 percent, the same as that for the three-month period from May to July 2018.

Looking at the various CPI components, year-on-year price rises were seen in food, electricity, gas and water, meals bough away from home, housing, alcoholic drinks and tobacco, clothing and footwear, miscellaneous services, miscellaneous goods and transport.

A Government spokesman stated that the underlying inflationary pressure remained largely stable in recent months. Meanwhile, the underlying inflation eased a bit on a year-on-year basis, owing mainly to the smaller rise in the charges for package tours and the fall in inbound and outbound transport fares that slightly outweighed the more rapid rise in the private housing rent component.

Looking ahead, inflationary pressure is likely to increase modestly in the months ahead, along with the gradual rise in global inflation and continued feed-through of earlier rises in fresh-letting residential rentals, stated the government spokesman.

“Yet, the inflation rate should stay within a moderate range for 2018 as a whole. The Government will continue to monitor the situation closely, particularly the impact on the lower-income people”, added the spokesman.