The consumer price index (CPI) for Hong Kong increased by 1.5 percent during the last six months compared to the same time in 2017. Officials anticipated that overall inflation would stay low in the foreseeable future.
According to figures released by the Census and Statistics Department, inflation rate increased by 1.8 percent in June year over year despite the abatement of electricity bill subsidies. Comparatively, 1.2 percent was recorded for May, and 1.3 percent for April.
After taking one-time government relief measures out of the equation, the underlying rate of inflation for June increased marginally from May’s 1.7 percent to 1.8 percent. The CPI is a gauge of inflation based on changes in the price of a predetermined basket of goods and services.
According to a government official, domestic cost pressures remained moderate despite rising inflation in some significant economies, and overall inflation should “remain moderate in the near term.”
“Prices of energy-related items recorded faster year-on-year increases, while the increases in prices of clothing and footwear as well as food remained visible. Price pressures on other major CPI components were broadly in check,” the official said.
The cost of water, gas, and electricity grew by 14.1 percent in June, while the cost of clothing and footwear increased by 5.5 percent and the cost of basic foods increased by 4.8 percent from 2021. On the other hand, the price of housing decreased by 0.5 percent.
Vera Yuen Wing-han, an economics lecturer at the University of Hong Kong Business School, predicted that the city’s inflation would be moderate by year’s end because falling residential rents accounted for about 37 percent of the CPI while food and other goods were primarily imported from the People’s Republic of China, where costs were still low.
“Also, due to the Hong Kong-US dollar peg, the city could avoid paying higher local currency prices of US dollar-denominated goods for imports,” Yuen added. “Hong Kong’s inflation will remain moderate. I don’t worry at all. It won’t go up like what is happening now in Western countries.”