tertiary services sectors, however, have continued to increase
in real terms (paragraph 4.9).
1.8
In the property market, the vacancy position for all types of property was high at the end of 1981. Although there
are indications that developers have been making adjustments
in the pace of ongoing building work, completions in terms of
total usable floor area continued to be substantial in
in the
third quarter (paragraph 5.4). Against the background of an
abundant supply in relation to demand, property prices and
rentals either levelled off or declined compared with the previous year (paragraph 5.5 and 5.6).
Inflation and the monetary aggregates
1.9
As aggregate demand in the economy was not imposing
much pressure on aggregate supply and nence on the general
price level, the rate of inflation slowed down in the third quarter (paragraph 5.1). The easing of inflation elsewhere in the world, coupled with the firmness of the Hong Kong dollar up until late September (paragraphs 3.10 and 3.11), partly as
a result of the narrowing of the visible trade gap (paragraph
2.9), also contributed. The weaker tone of the currency more
recently could, however, affect the price level adversely in
due course.
1.10
Monetary statistics continued to be influenced by a
number of special factors. The growth rate of the money supply picked up in the third quarter, but the growth rate of credit slowed down (paragraph 3.1). With the demand for
credit easing and interest rates falling
internationally,
there was a general decline in local interest rates during
this period (paragraph 3.9).
1.11
Given a relatively deflated internal cost/price structure and some spare capacity, the economy is well placed
to benefit from a revival in export demand as the economic recovery of Hong Kong's major trading partners gets underway.
3