Consumer Price Indices for May 2011
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     The Census and Statistics Department (C&SD) released today (June 21) the Consumer Price Index (CPI) figures for May 2011.  According to the Composite CPI, overall consumer prices rose by 5.2% in May 2011 over the same month a year earlier, larger than the corresponding increase (4.6%) in April 2011.  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 May 2011 was 5.1%, also larger than that in April (4.4%), mainly due to the enlarged increases in private housing rentals and the prices of food.
  
     On a seasonally adjusted basis, the average monthly rate of increase in the Composite CPI for the three-month period from March to May 2011 was 0.6%, and that for the three-month period from February to April 2011 was 0.7%.  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 March to May 2011 was 0.6%, the same as that for the three-month period from February to April 2011.
  
     Analysed by sub-index, the year-on-year rates of increase in the CPI(A), CPI(B) and CPI(C) were 5.6%, 5.2% and 4.9% respectively in May 2011, which compared to 5.0%, 4.5% and 4.2% respectively in April.  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 5.3%, 5.1% and 4.8% respectively in May 2011, which compared to 4.7%, 4.5% and 4.1% respectively in April.

     On a seasonally adjusted basis, for the three-month period from March to May 2011, the average monthly rates of increase in the seasonally adjusted CPI(A), CPI(B) and CPI(C) were 0.6%, 0.6% and 0.5% respectively.  The corresponding rates of change for the three-month period from February to April 2011 were all 0.7%.  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 March to May 2011 were 0.6%, 0.6% and 0.5% respectively, and for the three-month period from February to April 2011 were 0.6%, 0.6% and 0.7% respectively.
  
     Amongst the various CPI components, year-on-year increases in prices were recorded in May 2011 for alcoholic drinks and tobacco (19.8% in the Composite CPI and 22.2% in the CPI(A), mainly due to the increase in tobacco duty by 41.5%); food (excluding meals bought away from home) (10.1% in the Composite CPI and 10.3% in the CPI(A)); electricity, gas and water (7.9% in the Composite CPI and 11.0% in the CPI(A)); clothing and footwear (7.1% in the Composite CPI and 6.9% in the CPI(A)); housing (6.1% in the Composite CPI and 5.7% in the CPI(A)); meals bought away from home (5.1% in the Composite CPI and 5.4% in the CPI(A)); transport (4.8% in the Composite CPI and 3.2% in the CPI(A)); miscellaneous goods (4.1% in the Composite CPI and 3.4% in the CPI(A)) and miscellaneous services (2.7% in the Composite CPI and 1.8% in the CPI(A)).
  
     On the other hand, year-on-year decrease in prices were recorded in May 2011 for durable goods (-4.1% in the Composite CPI and -4.6% in the CPI(A)).

     Taking the first five months of 2011 together, the Composite CPI rose by 4.3% over a year earlier.  The corresponding increases in the CPI(A), CPI(B) and CPI(C) were 4.6%, 4.1% and 4.1%.  Netting out the effects of all Government's one-off relief measures, the Composite CPI, CPI(A), CPI(B) and CPI(C) rose by 4.1%, 4.3%, 4.1% and 4.1% respectively in the first five months of 2011 over a year earlier.  

     For the three months ended May 2011, the Composite CPI rose by 4.7% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 5.1%, 4.7% and 4.4% respectively.  The corresponding increases after netting out the effects of all Government's one-off relief measures were 4.6%, 4.8%, 4.5% and 4.4% respectively.

     For the 12 months ended May 2011, the Composite CPI was on average 3.3% higher than in the preceding 12-month period.  The corresponding change in the CPI(A), CPI(B) and CPI(C) were 3.5%, 3.2% and 3.1%.  The corresponding rates of change after netting out the effects of all Government's one-off relief measures were 3.0%, 3.1%, 2.9%, 2.9%.
  
     The new 2009/10-based CPI series, as was first announced by the C&SD on April 28, 2011, is compiled on the basis of the expenditure patterns obtained from the Household Expenditure Survey (HES) conducted during October 2009 to September 2010.  It replaces the old 2004/05-based series for analysing consumer price changes.  The old series will continue to be compiled in parallel with the new series until the reference month of December 2011.  It is an established practice in Hong Kong for the HES to be conducted and for the CPI series to be rebased once every five years.  Both the old and the new series of CPIs have been exhibiting a similar trend in recent months.

Commentary

     A Government spokesman says that consumer price inflation went up notably further in May.  Higher food prices and the sustained pass-through of higher private residential rentals remained the two key driving forces.  The rising inflation in Hong Kong has to be viewed against the background of elevated global food and commodity prices amid abundant liquidity and the continued robust expansion of the local economy.  Indeed, inflation is currently a common challenge facing many other Asian economies.

     The spokesman comments further that inflation is likely to go up further in the coming months, amid the higher price pressures from both the external and domestic fronts.  The Government will remain vigilant on the inflation situation, particularly its impact on the lower-income people.

Further information

     The CPIs and year-on-year rates of change at section level for May 2011 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 one-off 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 and seasonally adjusted data series) are available in the monthly reports.  Users can download the 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/statistical_report/prices_household_expenditure/index.jsp).  
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/Tuesday, June 21, 2011
Issued at HKT 16:31

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