Private residential rents are averaging HK$19.6/sqft, the highest since the HK$20.4/sqft peak in 1997.
DBS Group Research noted:
|The CPI for May is scheduled for release this week. Inflation as measured by the CPI is expected to be 5.0%, up from 4.6% in April. Component-wise, we have yet to see evidence of sustained declines in food prices, especially when droughts and floods ravage southern China. Private residential rents are averaging HK$19.6/sqft, the highest level recorded since the HK$20.4/sqft peak in September 1997. Rents are expected to climb alongside property prices, albeit at a slower pace than last year. Meanwhile, the minimum wage law that came into effect in May might make an impact as businesses mark-up prices. The fact that Hong Kong continues to import loose monetary policy from abroad, coupled with medium term weakness in the USD means inflationary pressures will remain in 2Q11.|
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