Hong Kong’s inflation rate held above 2 percent for a third straight month last month on higher rents and food prices.
Consumer prices increased 2.6 percent from a year earlier, the same as in September, the territory’s government said yesterday on its Web site. That was more than the median 2.4 percent estimate of nine economists in a Bloomberg News survey.
Hong Kong policymakers have blamed the US Federal Reserve’s plan to buy US$600 billion of US Treasury securities for contributing to price pressures in the territory, which maintains a pegged exchange rate with the US currency. The government earlier this month boosted its inflation estimate for this year to 2.5 percent from an August forecast of 2.3 percent.
Economic growth that reached a 6.8 percent annual pace in the third quarter has contributed to price pressures, the government said.
One-off government measures such as electricity subsidies and waivers of property rates and public housing rentals might have distorted Hong Kong’s inflation numbers. Excluding such effects, inflation was 2.3 percent last month, compared with 2.2 percent in September, the report showed.
“Inflation in Hong Kong is likely to go up further in the near term,” in part as prices climb across the region, the government said in the release.
Hong Kong’s inflation battle echoes that of China, where the highest rate in two years has prompted Chinese Premier Wen Jiabao’s (溫家寶) government to threaten price controls and release stockpiles of food reserves.
Chinese central bank adviser Li Daokui (李稻葵) said curbing inflation is the nation’s top priority as the economy stabilizes. Li spoke in an interview with state broadcaster China Central Television yesterday.
In Singapore, inflation is likely to accelerate further in the near term, Singaporean Senior Minister of State for Trade and Industry and Education S. Iswaran said in parliament yesterday.
“Cost pressures are growing, reflecting the high level of economic activity in Singapore,” Iswaran said.
“The cumulative rise in employment has led to some tightening in Singapore’s labor market. At the same time, food-price inflation is expected to accelerate” due to weather-related supply disruptions in various parts of the world, he said.
Singapore said it is “closely monitoring” the impact of capital inflows on the economy and will ensure such investments don’t threaten the stability of its asset and property markets.
Policymakers aren’t considering capital controls to limit the inflows, which are entering Asian markets because of the region’s growth prospects, Singaporean Minister for Finance Tharman Shanmugaratnam said in parliament yesterday.
“The capital inflows are generally being intermediated efficiently through our domestic financial markets and banking system,” Shanmugaratnam said. “We are not contemplating introducing capital controls but will continue to rely on a range of policy tools to ensure that capital flows do not threaten financial stability or cause a property-market bubble.”
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