Inflation Up Sharply, But Officials Cite Rent Waiver

Official figures released on Friday showed that annual inflation in Hong Kong hit 4.4 percent in September, more than double the 1.9 percent level recorded in August, though officials say a Covid relief measure accounted for most of the difference.

The Census and Statistics Department said the underlying rate of inflation remained the same as in August at 1.8 percent, with the difference in headline rates explained by the effects of one-off measures introduced in September 2021, notably a rent waiver for public housing tenants.

"While the headline inflation rate was notably higher, it was mainly due to the low base of comparison resulted from the waiver of public housing rentals by the Hong Kong Housing Authority in the same month last year," a government spokesman said.

However the figures show Hong Kong people are facing higher utilities bills, with electricity, gas and water up 14.5 percent. Housing costs rose 6.4 percent. Basic food cost 4.3 percent more while prices of meals out and takeaways went up 3.5 percent. Clothing and footwear cost 3 percent more.

"Looking at the individual CPI [Consumer Price Index] components, prices of food as well as clothing and footwear continued to record relatively visible year-on-year increases, while those of energy-related items soared further. But price pressures on other major components were broadly in check," the spokesman added.

"While import prices will continue to rise notably amid high inflation in many major economies, the largely mild domestic cost pressures should help keep overall inflation moderate in the near term. The government will continue to monitor the situation."