HK inflation eases to 4.7% in April

HONG KONG - Hong Kong's composite Consumer Price Index (CPI), a gauge of inflation, rose 4.7 percent in April from a year earlier, easing from 4.9 percent growth in March, the city's statistics department said Tuesday.

A government spokesman said inflation will ease further with a slowing local economy and receding domestic and external price pressure amid a more difficult economic environment.

Netting out the effects of the city government's one-off relief measures, the year-on-year rate of increase in April's CPI growth would come to 5.6 percent and match that in March, mainly due to eased increase in food prices and private housing rents.

However, eased increase in these prices was offset by faster rise in charges for package tours, the department added.

Food prices in April rose 8.8 percent from a year ago, followed by 7.2 percent in housing, 3.7 percent in transport, 3.4 percent in miscellaneous services and 3.3 percent in clothing and footwear.

Electricity, gas and water prices dropped 18.2 percent in April, while the prices for durable goods skid 0.5 percent.

HSBC economists said in a research note that the Chinese mainland's gradual shift towards disinflation, slower global growth and an intensifying base effect will should cool Hong Kong's CPI pressures through July.

"Most importantly, food and domestic energy price growth also remain under relative control in the Chinese mainland, where the inflation eased to 3.4 percent year-on-year from 3.6 percent previously," it said.

However, HSBC retained expectations for inflation in Hong Kong to edge back above 5 percent in the latter half of this year, and for full-year CPI to average 5.3 percent in 2012 again, which is the same as in 2011, it said.