Hong Kong: Inflation slows in 2012
January 21, 2013
In December, annual inflation remained unchanged at November's 3.7%. The reading fell short of market expectations of a 3.8% rate. According to the statistical institute, higher prices for housing and food drove the increase. In the full year 2012, annual inflation fell to 4.1%, which was down from the 5.3% recorded in 2011 but broadly in line with last month's FocusEconomics Consensus Forecast that had inflation at 4.0%.
A government spokesman stated that inflation is likely to remain contained in the near term, mainly due to weak economic performance and a more benign increase in import prices. That said, "further down the road, the volatility of international food and commodity prices amid the global liquidity glut, coupled with the pick-up in local housing rentals since the early part of 2012, may pose some upside risks to inflation."