The following is an unedited transcript of the news release from the Government of the Hong Kong,Census and Statistics Department.


The Census and Statistics Department (C&SD) released today (July 21) the Consumer Price Index (CPI) figures for June 2008. According to the Composite CPI, overall consumer prices rose by 6.1% in June 2008 over a year earlier.

The year-on-year rate of increase in the Composite CPI in June 2008 was not subject to the effect of one-off government measures, as the same relief measure of rates concession was implemented in both June 2007 and June 2008. Therefore, the underlying inflation rate in June 2008 (i.e. the year-on-year rate of increase in the Composite CPI with the effect of rates concession discounted) was also 6.1%.

The underlying inflation rate in June 2008 (6.1%) was higher than that in May 2008 (5.7%), mainly due to the enlarged increases in private housing rentals, charges for package tours, prices of rice and bus fares.

Analysed by sub-index, the year-on-year rates of increase in both the headline and underlying CPI(A), CPI(B) and CPI(C) were 6.1%, 6.3% and 5.8% respectively in June 2008, which compared to the corresponding headline rates of 5.6%, 5.8% and 5.5%; and the underlying rates of 5.6%, 5.8% and 5.6% in May.

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 April to June 2008, the average monthly rates of increase in the seasonally adjusted Composite CPI, CPI(A), CPI(B) and CPI(C) were all 0.5%. The corresponding rates of increase for the 3-month period from March to May 2008 were all 0.3%. Netting out the one-off effect of the rates concession, the corresponding average monthly rates of increase in the Composite CPI, CPI(A), CPI(B) and CPI(C) for the 3-month period from April to June 2008 were 0.5%, 0.6%, 0.5% and 0.5% respectively, and for the 3-month period from March to May 2008 were all 0.3%.

Amongst the various CPI components, large year-on-year increase in prices was recorded for food (excluding meals bought away from home) (18.9% in the Composite CPI and 20.6% in the CPI(A)) in June 2008. Food items showing large price increases were rice (64.0% in the Composite CPI as compared with a year earlier); beef (50.8%); pork (48.2%); canned meat (39.2%); edible oils (32.2%); fresh-water fish (27.7%) and other meat (26.8%).

Apart from food (excluding meals bought away from home), year-on-year increases in prices were recorded in June 2008 for electricity, gas and water (7.4% in the Composite CPI and 7.5% in the CPI(A)); meals bought away from home (6.4% in the Composite CPI and 6.9% in the CPI(A)); housing (6.3% in the Composite CPI and 3.1% in the CPI(A)); miscellaneous goods (5.6% in the Composite CPI and 6.3% in the CPI(A)); transport (3.3% in the Composite CPI and 1.6% in the CPI(A)); miscellaneous services (1.8% in the Composite CPI and 0.1% in the CPI(A)); clothing and footwear (1.4% in the Composite CPI and 4.8% in the CPI(A)) and alcoholic drinks and tobacco (1.1% in the Composite CPI and 1.9% in the CPI(A)).

On the other hand, year-on-year decline in prices was recorded in June 2008 for durable goods (-1.9% in the Composite CPI and -2.5% in the CPI(A)).

For the first half of 2008 as a whole, the Composite CPI rose by 5.1% over a year earlier. The corresponding increases in the CPI(A), CPI(B) and CPI(C) were 5.6%, 5.1% and 4.7%. Netting out the effects of various one-off measures, the Composite CPI, CPI(A), CPI(B) and CPI(C) rose by 5.3%, 5.3%, 5.5% and 5.2% respectively in the first half of 2008 as a whole over a year earlier.

In the second quarter of 2008, the Composite CPI rose by 5.7% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 5.7%, 5.9% and 5.5% respectively. The corresponding increases after netting out the effects of various one-off measures were 5.7%, 5.7%, 5.9% and 5.5% respectively.

For the 12 months ended June 2008, the Composite CPI was on average 3.8% higher than in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 3.8%, 3.9% and 3.9%. The corresponding increases after netting out the effects of various one-off measures were 4.2%, 4.0%, 4.3% and 4.3% respectively.

Commentary

A Government spokesman said that consumer price inflation went up further in June, mainly due to the sustained increases in food and energy costs as well as the strength of the local economy which exerted greater upward pressures on housing rents and, to a lesser extent, on prices of various goods and services.

The spokesman added that the inflation outlook for the rest of the year remains uncertain, due to the volatile international food and energy prices. The pace of economic expansion in the period ahead will also affect the extent of the domestically generated inflationary pressure. Nevertheless, the relief measures announced in the 2008-09 Budget and by the Chief Executive last week would help to lower the headline inflation notably in the latter part of 2008.


Available at:

http://www.censtatd.gov.hk/press_release/press_releases_on_statistics/index.jsp?sID=2163&sSUBID=11802&displayMode=D