Inflation reaches 6.4% in Sept
Hong Kong’s underlying inflation rate increased 6.4 percent in September, inching up from 6.3 percent in August, mainly driven by increases in private housing rentals, said a government spokesman, warning of further rise in the near term.
Overall CPI rose 5.8 percent in September from a year earlier, slightly higher than August’s 5.7 percent, data provided by the Census and Statistics Department showed on Friday, compared with a median 5.4 percent estimate in a Bloomberg survey.
“Inflation is showing no meaningful signs of cooling down, as solid wage growth and household spending continue to keep the economy operating close to capacity,” Donna Kwok, a locally-based HSBC economist, said on Friday. “As business conditions soften in response to persistent global economic uncertainties, inflationary pressures will likely peak in the coming months.”
Private housing rents rose 9.0 percent year-on-year in September, while food and clothes increased by 7.8 percent and 8.7 percent respectively, according to the government figures.
An official spokesman said the underlying inflation rate went up marginally in September, thanks to the slight easing off in food inflation after its almost uninterrupted rise over the past year.
Meanwhile, average private rental prices in the city rose to HK$20.6 per square foot in September, which surpassed the historic peak of HK$20.4 per square foot, the city’s largest real estate broker Centaline Property Agency Ltd said in a report this week.
Rents have gained a cumulative 56.1 percent during the past 30 months, the research report indicated.
Chief Executive Donald Tsang said on October 12 that the city is seeing “enormous inflationary pressure” from rising wages, and waived two-months public-housing rents to help handle rising costs.
At the same time, the prospect of slower growth in the US and the European debt crisis are hurting the economy by weakening export demand, Financial Secretary John Tsang said on October 16.
Underlying inflation figures net out the effects of the government’s one-off measures in John Tsang’s February budget including electricity subsidies, waivers of property rates and public housing rents, which distort the figures.
Bloomberg contributed to this story.
litao@chinadailyhk.com
China Daily
(HK Edition 10/22/2011 page2)
http://www.chinadaily.com.cn/hkedition/2011-10/22/content_13953447.htm