Inflation down 2.3% in July

The government’s payment of public housing rentals dragged it down.

Overall consumer prices dipped 2.3% YoY in July from a 0.7% climb in June, according to data from the Census and Statistics Department (C&SD).

The decline in July was mainly due to the government's payment of public housing rentals and waiver of two-thirds of rent for tenants of group B estates by the Hong Kong Housing Society.

Netting out the effects of all government's one-off relief measures, the YoY rate of inflation in the composite consumer price index (CPI) in July was 0.2%, smaller than that in June (1.2%). This was mainly due to the fall in the costs for meals bought away from home and the enlarged decreases in local transport fares.

On a seasonally adjusted basis, the composite CPI for the three-month period ending July slipped 1%.

Price declines were recorded in July for electricity, gas and water (-18.6%), housing (-4.8%), clothing and footwear (-4.7%), transport (-3.7%), durable goods (-3.2%) and meals bought away from home (-1.1%).

“Prices of meals bought away from home turned to a year-on-year decline in July, the first decline since early 2004, as the business environment became even more austere given the recent surge in local COVID-19 infections. Meanwhile, the fall in transportation prices enlarged visibly due to the extra MTR fare rebate starting from the month. Price pressures on many other major CPI components also receded further,” a government spokesperson said.

On the other hand, inflation was seen in food (excluding meals bought away from home) (3.9%), miscellaneous goods (2.3%), miscellaneous services (0.6%), and alcoholic drinks and tobacco (0.3%).