XN000022-1992-10-27 — Page 9

TUESDAY, OCTOBER 27, 1992

"BASIC FOODSTUFFS HAVE A HEAVY WEIGHTING IN THE CPI(A), AND WE ESTIMATE THAT VEGETABLE PRICES ACCOUNT FOR NEARLY 1 PERCENTAGE POINT OF THE 1.6 PERCENTAGE POINT DIFFERENCE BETWEEN THE YEAR-ON-YEAR INFLATION RATES OF 9.9% IN SEPTEMBER AND 8.3% IN AUGUST.

WE

"NOW HOWEVER VEGETABLE PRICES HAVE FALLEN THIS ALTHOUGH IT IS TOO EARLY TO PRODUCE FIRM ESTIMATES, MONTH'S INFLATION RATE TO BE LOWER, HE SAID.

**

MONTH AND, EXPECT THIS

THAT VEGETABLE PRICES ROSE SHARPLY LAST FOR THE MID-AUTUMN FESTIVAL COINCIDED

MR TANG EXPLAINED MONTH BECAUSE STRONG DEMAND WITH REDUCED SUPPLIES.

MOREOVER, THE

SIZE OF THE

INCREASE WAS DISTORTED IN COMPARISON WITH SEPTEMBER LAST YEAR WHEN PRICES WERE UNUSUALLY LOW FOR THE TIME OF YEAR: THEY HAD JUST DROPPED SHARPLY FROM THE HIGH PRICES IN AUGUST, CAUSED BY SEVERE FLOODING IN CHINA, HE ADDED.

"NORMALLY VEGETABLE PRICES TEND TO PEAK IN SEPTEMBER, SO YEAR ON YEAR WE CAN COMPARE LIKE WITH LIKE, MR TANG SAID.

"THIS YEAR OUR SEPTEMBER INFLATION FIGURE IS DISTORTED BECAUSE WE ARE COMPARING THIS YEAR'S PEAK VEGETABLE PRICES WITH A POST-PEAK FALL LAST YEAR, HE SAID.

11

EXPLAINING THE OTHER MAIN FACTOR AFFECTING THE INDICES, MR TANG SAID: "INCREASES IN SOME PUBLIC HOUSING RENTS LAST MONTH ADD ANOTHER 0.3% OF A PERCENTAGE POINT TO THE INCREASE IN THE CPI(A).'

**

THERE WAS LITTLE CHANGE BETWEEN AUGUST AND SEPTEMBER FOR OTHER CPI(A) COMPONENTS SUCH AS RESTAURANT MEALS, FUEL AND LIGHT, ALCOHOLIC DRINKS AND TOBACCO, CLOTHING AND FOOTWEAR, DURABLE GOODS, AND TRANSPORT AND SERVICES.

'THUS IT IS CLEAR THAT THE RELAPSE LAST MONTH WAS CONCENTRATED IN A FEW ITEMS AND WAS NOT WIDESPREAD," MR TANG SAID.

IN THE OTHER WHICH GIVE A LOWER

MR TANG ADDED THAT THE RELAPSE WAS LESS EVIDENT TWO PRICE INDICES - CPI(B) AND HANG SENG CPI WEIGHTING TO BASIC FOODSTUFFS AND RENTS.

THE YEAR-ON-YEAR INCREASE WAS 10.2% IN THE CPI (B), WITH 9.1% IN AUGUST. IN THE HANG SENG CPI IT WAS ALSO 10.2%, WITH 9.8% IN AUGUST.

COMPARED COMPARED

19

... . . . G .