Hong Kong: Inflation remains unchanged in October
November 22, 2010
In October, consumer prices jumped 2.1% over the previous month, which was well above the 0.3% rise recorded in September. The increase was the result of higher prices for housing (+5.9% month-on-month), as the September waiver of public housing rentals by the Housing Authority led to a low base of comparison. Despite the monthly price jump, annual inflation remained unchanged at September's 2.6%, exceeding market expectations, which had seen inflation moderating to 2.4%. However, annual average inflation inched up from 2.0% in September to 2.1%. A government spokesman stated that consumer prices are subject to upward pressures in the near term, as wages and rents continue to rise in tandem with the economic recovery. In addition, the new round of quantitative easing in the United States will also pose upside risks to inflation. The government sees inflation averaging 2.5% this year.