Hong Kong's underlying inflation climbs to 3.4%

However, clothing and footwear prices dropped.

Netting out the effects of Government one-off relief measures, Hong Kong’s underlying inflation rate was 3.4% in October, compared to 3.3% in September.

According to a research note from Barclays, the increases were recorded for electricity, gas and water, alcohol and tobacco, housing, meals bought away from home, food, transport, and miscellaneous goods and services.

Notably, prices for clothing and footwear dropped by 0.6% y/y and durable goods prices fell by 3.6% y/y.

The report said that the Census & Statistics Department attributed the higher headline inflation rate to the end of the Government's rates concession in October and some households using up the full amount of the Government's one-off electricity charge subsidy.

Further, the Hong Kong Government expects upside inflation risks to remain contained in the near term, given the benign global inflation and moderate local cost pressures.