THE ECONOMY
4.1 per cent, 5.4 per cent and 5.9 per cent in the first quarter of 2000 to 3.4 per cent, 4.6 per cent and 5.5 per cent in the second quarter, and further to 2.0 per cent, 2.9 per cent and 3.7 per cent in the third quarter, and 1.6 per cent, 2.2 per cent and 2.8 per cent in the fourth quarter. For 2000 as a whole, the CPI(A) and CPI(B) fell by 2.8 per cent and 3.8 per cent respectively, likewise smaller than the declines of 3.3 per cent and 4.7 per cent in 1999. Yet the CPI(C) showed a larger drop in 2000 than in 1999, by 4.5 per cent as against 3.7 per cent, mainly due to enlarged decreases in private housing cost and in the prices of meals at restaurants for households in the respective expenditure bracket.
The GDP deflator, as a broad measure of overall inflation in the economy, fell by 5.4 per cent in the fourth quarter of 2000 over a year earlier, somewhat reduced from the decreases of 6.9 per cent, 7.5 per cent and 6.4 per cent respectively in the first three quarters. This was mainly attributable to a further moderated decline in the price deflators for private consumption expenditure and government consumption expenditure, which more than offset the accelerated decrease in the price deflator for gross domestic fixed capital formation. Yet for 2000 as a whole, the GDP deflator went down by 6.5 per cent, still larger than the 5.1 per cent fall in 1999. Within the GDP deflator, the total final demand deflator and the domestic demand deflator eased by 3.0 per cent and 5.4 per cent respectively in 2000. The larger decrease in the GDP deflator than in the total final demand deflator was mainly due to an upturn in the price deflator for imports of goods and nil change in the price deflator for imports of services. The smaller decrease in the total final demand deflator than in the domestic demand deflator was attributable to only marginal declines in the price deflators for exports of goods and services.
Chart 18
Main inflation indicators (year-on-year rate of change)
Per cent
15
10
5
0
-5
-10
Composite CPI
GDP deflator
QI Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
1995
1996
1997
1998
1999 | 2000
The two major price indicators continued to fall in 2000, yet the decrease showed a distinct narrowing over the course of the year.
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