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The Census and Statistics Department (C&SD) released today (October 22) the Consumer Price Index (CPI) figures for September 2007. According to the Composite CPI, overall consumer prices rose by 1.6% in September 2007 over a year earlier.
The Budget measure of rates concession for the first two quarters of 2007/08 (i.e. April to September 2007) continued to carry effect on the CPIs in September. Netting out this factor, the year-on-year increase in the Composite CPI was 2.7% in September 2007.
The year-on-year increase in the Composite CPI in September 2007 (1.6%) was the same as in August. The year-on-year increase in food prices further enlarged from 4.6% in August to 6.0% in September. On the other hand, the implementation of the Pre-primary Education Voucher Scheme and the smaller increase in prices of package tours partly offset the impact of the higher food prices.
Analysed by sub-index, the year-on-year rates of increase in the CPI(A), CPI(B) and CPI(C) were 1.0%, 1.8% and 2.2% respectively in September 2007, which compared to 0.7%, 1.7% and 2.4% respectively in August. Netting out the one-off effect of the rates concession, the year-on-year increases in the CPI(A), CPI(B) and CPI(C) were 2.4%, 2.8% and 3.0% respectively in September.
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 ended September 2007, the average monthly rates of increase in the seasonally adjusted Composite CPI, CPI(A), CPI(B) and CPI(C) were 0.2%, 0.1%, 0.3% and 0.2% respectively. The corresponding rates of increase for the 3-month period ended August 2007 were 0.3%, 0.2%, 0.3% and 0.4%.
Amongst the various CPI components, larger year-on-year increase in prices was recorded for food (excluding meals bought away from home) (11.0% in the Composite CPI and 11.9% in the CPI(A)) in September 2007. Food items showing large price increases were eggs (32.0% in the Composite CPI as compared with a year earlier); pork (30.4%); canned meat (28.8%); poultry (27.8%); beef (26.1%); frozen meat (15.8%); fresh vegetables (14.0%) and other meat (13.9%).
Apart from food (excluding meals bought away from home), year-on-year increases in prices were recorded for meals bought away from home (3.0% in the Composite CPI and 2.7% in the CPI(A)), miscellaneous goods (2.0% in the Composite CPI and 2.2% in the CPI(A)), clothing and footwear (1.9% in the Composite CPI and 0.2% in the CPI(A)) and transport (0.3% in both the Composite CPI and CPI(A)).
On the other hand, year-on-year declines in prices were recorded in September 2007 for durable goods (-4.2% in the Composite CPI and -4.5% in the CPI(A)) and electricity, gas and water (-2.6% in both the Composite CPI and CPI(A)).
As for housing, the Composite CPI rose only by 0.3% over a year earlier and the CPI(A) fell by 2.6%, as affected by the rates concession and the public housing rental cut effective from August 2007. For miscellaneous services, the Composite CPI rose by 0.2% over a year earlier but the CPI(A) fell by 1.6%. However, for alcoholic drinks and tobacco, the Composite CPI fell by 0.2% over a year earlier but the CPI(A) rose by 0.8%.
Taking the first nine months of 2007 together, the Composite CPI rose by 1.5% over a year earlier. The corresponding increases in the CPI(A), CPI(B) and CPI(C) were 0.6%, 1.7% and 2.3%. Netting out the effect of the one-off measures of public rental waiver in February this year and the rates concession, the Composite CPI, CPI(A), CPI(B) and CPI(C) rose by 2.5%, 2.2%, 2.5% and 2.9% respectively in the first nine months of 2007 over a year earlier.
In the third quarter of 2007, the Composite CPI rose by 1.6% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 0.9%, 1.7% and 2.3% respectively.
For the 12 months ended September 2007, the Composite CPI was on average 1.7% higher than in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 0.9%, 1.8% and 2.3%.
Commentary
A Government spokesman noted that the headline and underlying inflation rates for September 2007 remained the same as for August, at 1.6% and 2.7% respectively, with the latter netting out the effect of rates concession. The implementation of the Pre-primary Education Voucher Scheme and the smaller increase in prices of package tours helped to offset the impact of higher food prices.
The spokesman further noted that prices of basic foodstuffs went up further in September against the background of the global food inflation. However, he explained that the sharp year-on-year increase in food prices in September was also to some extent caused by a seasonal rise in the prices of fresh fruits and poultry and around the Mid-Autumn festival, which fell in September this year but in October last year. The price increase for poultry was particularly sharp, due to the combined effect of seasonal surge in demand and reduced supply as a result of the outbreak of bird flu in some poultry farms in Guangdong.
The spokesman added that given the strength of the economy in recent years, inflation was on a slowly rising trend. Going forward, with the favourable effect of the rates concession fading out after September, the headline inflation rate was expected to go up in the fourth quarter to reflect the underlying inflation situation. Moreover, higher food prices, the renminbi appreciation, the weak US dollar and also the recent surge in oil prices would pose upside risks to inflation. Nevertheless, the recent cut in public housing rentals and sustained rise in labour productivity would continue to help alleviate upward price pressures in the coming months.
Further information
The CPIs and year-on-year rates of change at section level for September 2007 are shown in Table 1. The time series of movements of CPIs and the corresponding year-on-year rates of change upon removing the effect of one-off measures are shown in Table 2. The rates of change in the original and the seasonally adjusted Composite CPI are presented graphically in Chart 1.
Users can download the September 2007 issue of the Monthly Report on the Consumer Price Index free of charge at the Website of the C&SD (www.censtatd.gov.hk/ products_and_services/products/publications/index.jsp). Print version of this publication is available for sale at HK$49 per issue. Purchase can be done in person at the Publications Unit of the C&SD (Address: 19/F Wanchai Tower, 12 Harbour Road, Wan Chai; Tel: 2582 3025) or through mail order by returning a completed order form which can be downloaded from the C&SD's website (www.censtatd.gov.hk/products_and_services/other_services/provision_of_stat/mail_ordering_of_publications/index.jsp). Print version of this publication is also available for sale online at the Government Bookstore of the Information Services Department (www.bookstore.gov.hk).
For enquiries about the CPIs, please contact the Consumer Price Index Section of the C&SD at telephone no. 2805 6403 or email address cpi@censtatd.gov.hk.
Ends/Monday, October 22, 2007
Issued at HKT 16:15
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