Consumer Price Indices for February 2014
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     The Census and Statistics Department (C&SD) released today (March 20) the Consumer Price Index (CPI) figures for February 2014. According to the Composite CPI, overall consumer prices rose by 3.9% in February 2014 over the same month a year earlier, smaller than the corresponding increase (4.6%) in January 2014. 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 2014 was 3.6%, also smaller than that in January (4.3%).

     The smaller increase was mainly attributable to the difference in the timing of the Lunar New Year, which fell in late January and early February this year but in mid-February last year, resulting in smaller increase in the charges for package tours and the costs for meals bought away from home in February 2014. Another contributing factor was the moderation in the increase in private housing rentals.

     Taking the first two months of 2014 together to neutralise the effect of the Lunar New Year, the Composite CPI rose by 4.3% over a year earlier. Netting out the effect of all Government's one-off relief measures, the Composite CPI rose by 4.0% in the first two months of 2014 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 2013 to February 2014 was 0.3%, and that for the three-month period from November 2013 to January 2014 was 0.4%. 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 2013 to February 2014 was 0.3%, and that for the three-month period from November 2013 to January 2014 was 0.4%.

     Analysed by sub-index, the year-on-year rates of increase in the CPI(A), CPI(B) and CPI(C) were 4.2%, 4.0% and 3.5% respectively in February 2014, which compared to 4.5%, 4.8% and 4.5% respectively in January. 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 4.1%, 3.7% and 3.0% respectively in February 2014, which compared to 4.3%, 4.5% and 4.0% respectively in January.

     Taking the first two months of 2014 together, the CPI(A), CPI(B) and CPI(C) rose by 4.3%, 4.4% and 4.0% 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 4.2%, 4.1% and 3.5% respectively in the first two months of 2014 over a year earlier.

     On a seasonally adjusted basis, for the three-month period from December 2013 to February 2014, the average monthly rates of increase in the seasonally adjusted CPI(A), CPI(B) and CPI(C) were 0.4%, 0.3% and 0.2% respectively. The corresponding rates of increase for the three-month period from November 2013 to January 2014 were all 0.4%. 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 2013 to February 2014 were 0.4%, 0.3% and 0.2% respectively, and the corresponding rates of increase for the three-month period from November 2013 to January 2014 were 0.3%, 0.4% and 0.4% respectively.

     Amongst the various CPI components, year-on-year increases in prices were recorded in February 2014 for electricity, gas and water (5.6% in the Composite CPI and 6.1% in the CPI(A)); housing (5.5% in the Composite CPI and 5.1% in the CPI(A)); meals bought away from home (4.2% in the Composite CPI and 4.6% in the CPI(A)); food (excluding meals bought away from home) (4.1% in the Composite CPI and 4.4% in the CPI(A)); miscellaneous services (3.5% in the Composite CPI and 3.7% in the CPI(A)); miscellaneous goods (3.2% in the Composite CPI and 4.9% in the CPI(A)); transport (2.2% in the Composite CPI and 2.5% in the CPI(A)); clothing and footwear (1.9% in the Composite CPI and 1.8% in the CPI(A)) and alcoholic drinks and tobacco (1.5% in the Composite CPI and 1.3% in the CPI(A)).

     On the other hand, year-on-year decrease in prices was recorded in February 2014 for durable goods (-3.1% in the Composite CPI and -3.6% in the CPI(A)).

     For the three months ended February 2014, the Composite CPI rose by 4.3% over a year earlier, while the CPI(A), CPI(B) and CPI(C) rose by 4.3%, 4.4% and 4.0% respectively. The corresponding increases after netting out the effects of all Government's one-off relief measures were 4.0%, 4.2%, 4.1% and 3.5% respectively.

     For the 12 months ended February 2014, the Composite CPI was on average 4.4% higher than in the preceding 12-month period. The respective increases in the CPI(A), CPI(B) and CPI(C) were 5.1%, 4.2% and 3.9%. The corresponding increases after netting out the effects of all Government's one-off relief measures were 4.0%, 4.5%, 3.9% and 3.6% respectively.

Commentary

     A Government spokesman said that inflation pressure remained largely contained. Taking January and February 2014 together to neutralise the distortions by the timing of the Lunar New Year, the underlying inflation rate averaged 4.0%, same as in the fourth quarter of last year. Also, it is worth noting that in February prices of fresh vegetables rose faster amid cold weather, while the rise in private housing rentals continued to moderate.

     The spokesman commented further that, looking ahead, the generally mild imported inflation and the feed-through of the milder increases in fresh-letting residential rentals in 2013 should help contain the upside risks to inflation in the near term. The Government will monitor the inflation situation 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 2014 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, 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 2014 issue of the Monthly Report on the Consumer Price Index free of charge at the website of the C&SD (www.censtatd.gov.hk/hkstat/sub/sp270.jsp?productCode=B1060001).

     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/Thursday, March 20, 2014
Issued at HKT 16:30

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