TNAG-0621-FCO40-769-Budget-of-Hong-Kong-1977 — Page 149

G.F. 323

82.

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The consumer price index is heavily influenced by the prices

of foodstuffs.

41.

Diagram 12 shows movements in the consumer price'index

together with movements in the food and non-food portion of the index.

Consumer prices of non-food items were on a very steady climb all

through 1975 and 1976 but consumer prices of foodstuffs fluctuated widely

although on average the trend increase was moderate.

Prices of raw material and semi-manufactures

83.

After remaining stable in 1975 at a level 13% below that of

1974, import prices of raw materials and semi-manufactures started to

increase during 1976 reflecting a general recovery in demand in the

largo industrial economies. The unit value index of imported raw

materials and semi-manufactures for the first three quarters of 1976

was 4.2% higher than for the corresponding period in 1975. Most of the

higher prices were recorded in textile materials including raw cotton;

yam of cotton, wool and man-made fibres; and fabrics of man-made fibres.

Part of the increase was compensated for by lower (compared to the

corresponding period in 1975) import prices of such non-textile materials

as chemicals, iron a steel, paper and paperboard, and construction

materials. However, towards the fourth quarter of 1976 import prices of

textile materials stabilized cwing to slackened consumer demand overseas

during the second and thir? quarters of 1976 coupled with over restocking

carlier in the year.

84.

Diagram 13]

Frices of construction materials have also stabilised since the

second quarter of 1976 after recovering during the first quarter of 1976

from the trough recorded in the last quarter of 1975. This has, to a

certain extent prevented domestic building and construction costs from

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