The Census and Statistics Department (C&SD) released today (March 21) the Consumer Price Index (CPI) figures for February 2017. According to the Composite CPI, overall consumer prices fell by 0.1% in February 2017 over the same month a year earlier, after an increase of 1.3% in January 2017. Netting out the effects of all Government's one-off relief measures, the year-on-year rate of increase in the Composite CPI (i.e. the underlying inflation rate) in February 2017 was 0.7%, smaller than that in January 2017 (2.1%). The smaller increase was mainly attributable to the difference in the timing of the Lunar New Year, which fell in late January this year but in early February last year, resulting in the decreases in the charges for package tours. Another contributing factor was the enlarged decreases in the prices of fresh vegetables.

     Taking the first two months of 2017 together to neutralise the effect of the Lunar New Year, the Composite CPI rose by 0.6% over a year earlier. Netting out the effect of all Government's one-off relief measures, the Composite CPI rose by 1.5% in the first two months of 2017 over a year earlier.

     On a seasonally adjusted basis, the average monthly rate of change in the Composite CPI for the 3-month period from December 2016 to February 2017 was -0.1%, and the corresponding rate of change for the 3-month period from November 2016 to January 2017 was 0.1%. Netting out the effects of all Government's one-off relief measures, the average monthly rate of change in the Composite CPI for the 3-month period from December 2016 to February 2017 was -0.1%, and the corresponding rate of change for the 3-month period from November 2016 to January 2017 was 0.1%.

     Analysed by sub-index, the year-on-year rates of change in the CPI(A), CPI(B) and CPI(C) were -0.6%, virtually nil and 0.3% respectively in February 2017, as compared to 0.8%, 1.3% and 1.7% respectively in January 2017. 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 0.9%, 0.7% and 0.6% respectively in February 2017, as compared to 2.3%, 2.0% and 2.1% respectively in January 2017.

     Taking the first two months of 2017 together, the CPI(A), CPI(B) and CPI(C) rose by 0.1%, 0.7% and 1.0% respectively over a year earlier. Netting out the effects of all Government's one-off relief measures, the CPI(A), CPI(B) and CPI(C) rose by 1.6%, 1.4% and 1.3% respectively in the first two months of 2017 over a year earlier.

     On a seasonally adjusted basis, for the 3-month period from December 2016 to February 2017, the average monthly rates of change in the seasonally adjusted CPI(A), CPI(B) and CPI(C) were -0.1%, -0.1% and virtually nil respectively. The corresponding rates of change for the 3-month period from November 2016 to January 2017 were all 0.1%. Netting out the effects of all Government's one-off relief measures, the corresponding average monthly rates of change in the seasonally adjusted CPI(A), CPI(B) and CPI(C) for the 3-month period from December 2016 to February 2017 were -0.1%, -0.1% and virtually nil respectively, and the corresponding rates of change for the 3-month period from November 2016 to January 2017 were all 0.1%.

     Amongst the various CPI components, year-on-year decreases in prices were recorded in February 2017 for electricity, gas and water (-7.5% in the Composite CPI and -7.0% in the CPI(A)); food (excluding meals bought away from home) (-3.7% in the Composite CPI and -4.7% in the CPI(A)); durable goods (-3.7% in the Composite CPI and -3.9% in the CPI(A)); clothing and footwear (-3.3% in the Composite CPI and -3.2% in the CPI(A)) as well as miscellaneous services (-1.1% in the Composite CPI and -0.5% in the CPI(A)).

     On the other hand, year-on-year increases in prices were recorded in February 2017 for transport (3.1% in the Composite CPI and 2.3% in the CPI(A)), meals bought away from home (2.8% in the Composite CPI and 2.9% in the CPI(A)), alcoholic drinks and tobacco (2.7% in the Composite CPI and 3.2% in the CPI(A)) as well as miscellaneous goods (2.5% in the Composite CPI and 2.9% in the CPI(A)).

     As for housing, the Composite CPI rose by 0.2% over a year earlier but the CPI(A) fell by 0.7%.

     For the 3 months ended February 2017, the Composite CPI rose by 0.8% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 0.4%, 0.8% and 1.1% respectively. The corresponding increases after netting out the effects of all Government's one-off relief measures were 1.7%, 1.9%, 1.6% and 1.4% respectively.

     For the 12 months ended February 2017, the Composite CPI was on average 2.0% higher than that in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 2.3%, 2.0% and 1.8%. The corresponding increases after netting out the effects of all Government's one-off relief measures were 2.1%, 2.3%, 2.0% and 1.8% respectively.

Commentary

     A Government spokesman said that, taking the first two months of 2017 together to neutralise the distortions by the timing of the Lunar New Year, the underlying inflation rate moderated to 1.5%, down from 2.0% in December 2016. This was mainly due to the high base of comparison a year earlier when prices of basic foodstuffs surged in early 2016 because of bad weather conditions back then. The favourable effects from the downward adjustment in the electricity charge also contributed. Overall speaking, inflation pressure stayed moderate in early 2017, whereas the slightly negative year-on-year headline inflation rate in February was due to a host of temporary factors such as one-off rates waiver, holiday and base effects.

     The spokesman commented further that, looking ahead, inflation pressure should remain contained in the near term, given the low imported inflation and moderate increases in local costs. The Government will continue to monitor the inflation developments closely, particularly its impact on the lower-income people.

Further information

     The CPIs and year-on-year rates of change at section level for February 2017 are shown in Table 1. The time series on the year-on-year rates of change in the CPIs before and after removing the effects of Government's one-off relief measures are shown in Table 2. For discerning the latest trend in consumer prices, it is also useful to look at the changes in the seasonally adjusted CPIs. The corresponding time series on the average monthly rates of change during the latest 3 months for the seasonally adjusted CPIs are shown in Table 3. The rates of change in the original and the seasonally adjusted Composite CPI and the underlying inflation rate are presented graphically in Chart 1.

     More detailed CPI data (including year-on-year comparison, month-to-month comparison, seasonally adjusted data series and the CPIs by the Classification of Individual Consumption According to Purpose (COICOP)) are available in the monthly reports. Users can download the February 2017 issue of the Monthly Report on the Consumer Price Index (www.censtatd.gov.hk/hkstat/sub/sp270.jsp?productCode=B1060001), the time series of CPIs at detailed level (www.censtatd.gov.hk/hkstat/sub/sp270.jsp?productCode=D5600001) and the time series of CPIs at COICOP division level (www.censtatd.gov.hk/hkstat/sub/sp270.jsp?productCode=D5600002) free of charge at the website of the C&SD.

     For enquiries about the CPIs, please contact the Consumer Price Index Section of the C&SD at telephone no. 3903 7374 or email address cpi@censtatd.gov.hk.

Ends/Tuesday, March 21, 2017
Issued at HKT 16:30

NNNN