This is the unedited press release from Census and Statistics Department,Hong Kong.


The Census and Statistics Department (C&SD) released today (January 22) the Consumer Price Index (CPI) figures for December 2008. According to the Composite CPI, overall consumer prices rose by 2.1% in December 2008 over a year earlier.

The year-on-year rates of change in the CPIs in December 2008 were affected by various Government''s one-off relief measures, in particular the implementation of electricity charge subsidy and the rates concession.

Netting out the effects of all Government''s one-off relief measures, the year-on-year rate of increase in the Composite CPI in December 2008 (i.e. the underlying inflation rate) was 4.6%, considerably smaller than that in November (5.6%), due to the decrease or smaller increase in prices of a number of items, including food, package tours, private housing rentals, motor fuel and the fuel cost variation charge for towngas. In particular, the year-on-year rate of increase in prices of food (excluding meals bought away from home) moderated from 14.9% in November 2008 to 11.5% in December 2008 in the Composite CPI; and that for package tours and motor fuel moderated from 10.3% to 1.0% and from -4.1% to -14.7% respectively.

Analysed by sub-index, the year-on-year rates of increase in the headline CPI(A), CPI(B) and CPI(C) were 1.2%, 2.4% and 2.7% respectively in December 2008, which compared to 2.1%, 3.3% and 3.8% respectively in November. Netting out the effects of all Government''s one-off relief measures, the year-on-year rates of increase in the CPI(A), CPI(B) and CPI(C) were 4.7%, 4.7% and 4.4% respectively in December 2008, which compared to 5.6%, 5.6% and 5.5% respectively in November. The larger difference between the change in headline and underlying CPI(A) reflected that Government''s one-off relief measures had larger impacts on the lower expenditure households.

For discerning the latest trend in consumer prices, it is also useful to look at the changes in the seasonally adjusted CPIs. For the 3-month period from October to December 2008, the average monthly rates of change in the seasonally adjusted Composite CPI, CPI(A), CPI(B) and CPI(C) were 0.6%, 1.5%, 0.3% and virtually nil respectively. The corresponding rates of increase for the 3-month period from September to November 2008 were 0.3%, 0.9%, 0.1% and 0.1%. However, it should be noted that these rates of change were affected by Government''s one-off relief measures implemented only in some months. Netting out these effects, the corresponding average monthly rates of change in the Composite CPI, CPI(A), CPI(B) and CPI(C) for the 3-month period October to December 2008 were virtually nil, 0.1%, 0.1% and virtually nil respectively, and for the 3-month period from September to November 2008 were 0.2%, 0.1%, 0.2% and 0.3% respectively.

Amongst the various CPI components, larger year-on-year increase in prices was still recorded in December 2008 for food (excluding meals bought away from home) (11.5% in the Composite CPI and 12.4% in the CPI(A)), as affected by the price increases recorded in the early half of 2008. Food items showing larger year-on-year price increases were rice (50.2% in the Composite CPI as compared with a year earlier); fresh-water fish (26.1%); eggs (25.6%); canned meat (22.2%); beef (20.6%) and edible oils (20.4%).

Apart from food (excluding meals bought away from home), year-on-year increases in prices were recorded in December 2008 for meals bought away from home (5.2% in both the Composite CPI and CPI(A)); miscellaneous goods (4.2% in the Composite CPI and 4.4% in the CPI(A)); housing (4.2% in the Composite CPI and 1.4% in the CPI(A)) and transport (1.5% in the Composite CPI and 2.5% in the CPI(A)).

On the other hand, large year-on-year decline in prices was recorded in December 2008 for electricity, gas and water (-37.1% in the Composite CPI and -42.4% in the CPI(A)), largely as a result of Government''s electricity charge subsidy. Declines were also recorded for durable goods (-1.7% in both the Composite CPI and CPI(A)) and miscellaneous services (-1.1% in the Composite CPI and -3.2% in the CPI(A)).

As for alcoholic drinks and tobacco, the Composite CPI remained unchanged over a year earlier but the CPI(A) rose by 0.3%. As for clothing and footwear, the Composite CPI fell by 1.5% over a year earlier but the CPI(A) rose by 0.2%.

In the fourth quarter of 2008, the Composite CPI rose by 2.3% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 0.6%, 2.9% and 3.6% respectively. The corresponding increases after netting out the effects of all Government''s one-off relief measures were 5.4%, 5.4%, 5.4% and 5.2%.

For 2008 as a whole, the Composite CPI was on average 4.3% higher than in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 3.6%, 4.6% and 4.7%. The corresponding increases after netting out the effects of all Government''s one-off relief measures were 5.6%, 5.6%, 5.7% and 5.4%.

Commentary

A Government spokesman said that inflationary pressures eased notably in December, reflecting the continuous tapering of food price inflation, the fall in energy prices and the weaker demand conditions.

The spokesman added that global inflationary pressures will continue to recede going forward, amid the retreat of commodity prices and a synchronised global economic downturn. The inflationary pressures in Hong Kong will likewise come down in the period ahead.


Available at:

http://www.censtatd.gov.hk/press_release/press_releases_on_statistics/index.jsp?sID=2270&sSUBID=12946&displayMode=D