February 23, 2015

Annual inflation fell from 4.9% in December to 4.1% in January. The print undershot the 4.4% that markets had expected and represented the lowest figure in five months. According to the Census and Statistics Department, January’s result was driven by higher prices for electricity, gas and water as well as for housing. A government spokesman explained that, “the visible moderation in the year-on-year rate of Composite CPI inflation was also partly due to the difference in timing of the Lunar New Year, which fell in mid-February this year, but in late January last year.”



Consumer prices increased 0.1% over the previous month in seasonally-adjusted terms in January, which followed the 0.5% increase recorded in the previous month. Meanwhile, annual average variation in consumer prices stabilized at the previous month’s 4.4% in January.

FocusEconomics Consensus Forecast panelists expect inflation to average 3.4% in 2015, which is unchanged from last month’s forecast. For 2016, the panel expects annual average inflation to moderate to 3.2%.