The Census and Statistics Department (C&SD) released today (March 20) the Consumer Price Index (CPI) figures for February 2018. According to the Composite CPI, overall consumer prices rose by 3.1% in February 2018 over the same month a year earlier, larger than the corresponding increase (1.7%) in January 2018. 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 2018 was also 3.1%, larger than that in January 2018 (1.7%). The larger increase was mainly attributable to the difference in the timing of the Lunar New Year, which fell in mid-February this year but in late January last year, resulting in a notable year-on-year increase in the charges for package tours in February 2018.

     Taking the first two months of 2018 together to neutralise the effect of the Lunar New Year, the Composite CPI rose by 2.4% over a year earlier. Netting out the effect of all Government's one-off relief measures, the Composite CPI rose by 2.3% in the first two months of 2018 over a year earlier.

     On a seasonally adjusted basis, the average monthly rate of increase in the Composite CPI for the three-month period from December 2017 to February 2018 was 0.3%, and that for the three-month period from November 2017 to January 2018 was 0.2%. Netting out the effects of all Government's one-off relief measures, the average monthly rate of increase in the Composite CPI for the three-month period from December 2017 to February 2018 was 0.3%, and that for the three-month period from November 2017 to January 2018 was 0.2%. 

     Analysed by sub-index, the year-on-year rates of increase in the CPI(A), CPI(B) and CPI(C) were 3.1%, 3.0% and 3.2% respectively in February 2018, as compared to 2.0%, 1.6% and 1.5% respectively in January 2018. 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 3.0%, 3.0% and 3.2% respectively in February 2018, as compared to 1.9%, 1.6% and 1.5% respectively in January 2018. 

     Taking the first two months of 2018 together, the CPI(A), CPI(B) and CPI(C) rose by 2.5%, 2.3% and 2.3% 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 2.5%, 2.3% and 2.4% respectively in the first two months of 2018 over a year earlier.

     On a seasonally adjusted basis, for the three-month period from December 2017 to February 2018, the average monthly rates of increase in the seasonally adjusted CPI(A), CPI(B) and CPI(C) were all 0.3%. The corresponding rates of increase for the three-month period from November 2017 to January 2018 were all 0.2%. Netting out the effects of all Government's one-off relief measures, the corresponding average monthly rates of increase in the seasonally adjusted CPI(A), CPI(B) and CPI(C) for the three-month period from December 2017 to February 2018 were all 0.3%, and the corresponding rates of increase for the three-month period from November 2017 to January 2018 were all 0.2%. 

     Amongst the various CPI components, year-on-year increases in prices were recorded in February 2018 for electricity, gas and water (10.9% in the Composite CPI and 11.5% in the CPI(A), mainly due to the low base of comparison resulted from the special fuel rebate in electricity starting from January last year); food (excluding meals bought away from home) (4.6% in the Composite CPI and 4.5% in the CPI(A)); miscellaneous services (4.0% in the Composite CPI and 1.8% in the CPI(A)); meals bought away from home (3.6% in both the Composite CPI and CPI(A)); clothing and footwear (3.5% in the Composite CPI and 3.3% in the CPI(A)); housing (2.5% in the Composite CPI and 2.7% in the CPI(A)); transport (2.1% in the Composite CPI and 1.6% in the CPI(A)); miscellaneous goods (1.1% in the Composite CPI and 1.6% in the CPI(A)) as well as alcoholic drinks and tobacco (0.1% in the Composite CPI and 0.4% in the CPI(A)). 

     On the other hand, year-on-year decrease in prices was recorded in February 2018 for durable goods (-2.8% in the Composite CPI and -3.0% in the CPI(A)). 

     For the three months ended February 2018, the Composite CPI rose by 2.2% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 2.3%, 2.1% and 2.2% respectively. The corresponding increases after netting out the effects of all Government's one-off relief measures were 2.1%, 2.2%, 2.0% and 2.2% respectively. 

     For the 12 months ended February 2018, the Composite CPI was on average 1.8% higher than that in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 1.9%, 1.7% and 1.7%. The corresponding increases after netting out the effects of all Government's one-off relief measures were 1.8%, 2.0%, 1.7% and 1.8% respectively. 

Commentary

     A Government spokesman said that inflation pressure in early 2018 remained moderate. Taking the first two months of 2018 together to neutralise the distortions by the timing of the Lunar New Year, the underlying inflation rate went up to 2.3%. Some temporary factors were at play in the higher inflation rate in the first two months of 2018 combined, including the spike in electricity charge in both months due to the low base of comparison created by the special fuel rebate a year ago, as well as higher fresh vegetable prices in February this year due to the adverse weather conditions. The faster year-on-year increase in charges for package tours in both months combined also partly contributed.

     The spokesman commented further that, temporary factors aside, with the continued expansion in the global and local economies, the underlying inflation pressure may increase somewhat over the course of 2018, though the inflation rate is expected to be contained at a moderate level. The Government will continue to monitor the inflation developments closely, particularly the impact on the lower-income people.

Further information

     The CPIs and year-on-year rates of change at section level for February 2018 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 three 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 2018 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 (Tel: 3903 7374 or email: cpi@censtatd.gov.hk).

Ends/Tuesday, March 20, 2018
Issued at HKT 16:30

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