Hong Kong: Inflation edges up in January
February 21, 2014
Annual inflation came in at 4.6% in January, which was above the 4.3% recorded in December. The print exceeded the 4.4% market analysts had expected and marked the highest rate in four months. According to the Census and Statistics Department, the result was mainly driven by higher prices for electricity, gas and water, as well as for housing. Annual average inflation increased from 4.3% in December to 4.5% in January.
A government spokesman stated that annual inflation increased in January, "due mainly to the difference in timing of the Lunar New Year," and thus, "it would be more meaningful to examine the figures for January and February combined." The official also commented that, "ahead, the still-low imported inflation and the feed-through of the milder increases in fresh-letting residential rentals in 2013 should help contain the upside risks to inflation in the near term."
FocusEconomics Consensus Forecast panelists expect inflation to average 3.7% in 2014, which is unchanged from last month's forecast. For 2015, the panel expects annual average inflation to moderate to 3.5%.