Hong Kong - Inflation

Inflation jumps to highest point in six months in July

Annual inflation jumped from 3.6% in June to 4.0% in July, which represented the highest rate since January. The print overshot the 3.5% market analysts had expected. According to the Census and Statistics Department, the result was mainly driven by higher price increases in the electricity, gas and water category given that, “some households used up the full amount of the Government’s one-off electricity charge subsidy.”

In July, consumer prices rose 0.4% over the previous month in seasonally-adjusted terms, which was above the 0.2% increase recorded in the previous month. Despite the faster year-on-year increase, annual average inflation inched down from 4.3% in June to 4.1% in July.

A government spokesman stated that, “underlying inflation continued an easing trend,” mainly due to, “slower increases in private housing rentals and the modest rises in import prices.” In addition, the spokesman noted that, “looking ahead, underlying inflation should remain contained for the rest of the year, given the generally modest price pressures both locally and externally.”

The government expects inflation to reach 4.4% in 2014. FocusEconomics Consensus Forecast panelists expect inflation to average 3.8% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel expects annual average inflation to moderate to 3.4%.

Hong Kong - Inflation Data

2009   2010   2011   2012   2013  
Inflation Rate (CPI, annual variation in %)0.6  2.3  5.3  4.1  4.3  

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Hong Kong Inflation Chart

Hong Kong Inflation
Note: Annual variation of consumer price index (CPI) in %.
Source: Census and Statistics Department Hong Kong and FocusEconomics calculations.

Hong Kong Facts

Value % Change Date
Bond Yield1.9-1.14 %Sep 01
Exchange Rate7.750.0 %Sep 01
Stock Market24,7420.0 %Sep 01

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