Hong Kong Inflation

Hong Kong

Hong Kong: Inflation stabilizes in May

June 23, 2014

Annual inflation came in at 3.7% in May, which matched the result tallied in the previous month and marked the lowest rate since March 2013. The print slightly undershot the 3.8% market analysts had expected. According to the Census and Statistics Department, the result was mainly driven by higher prices for alcoholic beverages and tobacco as well as for housing.

In May, consumer prices rose 0.2% over the previous month in seasonally-adjusted terms, which was in line with the increase recorded in the previous month.

A government spokesman stated that, “inflation held largely stable in May,” and stressed that inflationary pressure are still contained. In addition, the spokesman noted that, “looking ahead, the upside risks to inflation should remain limited in the near term, given the modest rise in import prices, easing rental pressures and steady wage growth.”

The government expects inflation to reach 4.6% in 2014. FocusEconomics Consensus Forecast panelists expect inflation to average 3.9% in 2014, which is unchanged from last month’s forecast. For 2015, the panel expects annual average inflation to moderate to 3.5%.

Author: Ricard Torné, Lead Economist

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Hong Kong Inflation Chart

Hong Kong Inflation May 2014

Note: Year-on-year and annual average variation of consumer price index in %.
Source: Census and Statistics Department Hong Kong and FocusEconomics Consensus Forecast.

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