JAN 28 '93 11:14 UKDEL
FCO 2
TUE 26 JAN 93 13:21
PG.07
GUERMENT HOUSE HONG KONG.
TUE 26 JAN 93 89182.
P0.10
(D)
|Inflation
(A)
CONFIDENTIAL
P.2/6
On
the staff's observation of rapid rates of monetary and credit expansion (second paragraph on Page 6), it should be noted that although the interest rates have declined substantially along with those in the United states, the exparmion in money supply during the year perated by the robust domestic stock GoTiritime A Money supply and credit growth
distorted by the huge amount
figured
subscription
shares tied up in the
The year-on-year sonstary growth has in fact to only around 138 by the end of 1992, which ia slightly lower than the forecast growth in nominki GDF foc. 199z et around 15#.
!
acknowledging that inflation remains a key policy damcom to be tackled, the XX Authorities note Bhat CONSUMET price inflation has been Moderating trend during most of 1992. For the year
■ whole, the rate of infiation, as measured by the
Pršom Tischma' {X}, ayuzzyed at
•
to
sepresented
originál
significant deceleration from
41, which was forecast of 9.5% and
the
qyeraga of 12%
recorded in 1991.