Headline inflation rate estimate 3.5%
February 01, 2012
Financial Secretary John Tsang forecasts the average underlying inflation rate will drop from last year's 5.3% to 4% this year, while the headline inflation rate is estimated to be 3.5%.
In his 2012-13 Budget speech at the Legislative Council today, Mr Tsang said he is not optimistic about Hong Kong’s export performance in the first half of the year, and if exports plunge in the first quarter, the overall economy may take a downturn in that quarter.
He said the measures proposed are worth nearly $80 billion and make a strong package which will help stimulate the economy 1.5 percentage points this year.
He forecasts Gross Domestic Products growth will be 1% to 3% in real terms for this year.
With global food and commodity prices retreating from peaks and local costs easing off as a result of the economic slowdown, he believes the inflation rate will ease quite visibly in the second half of this year.
The average underlying inflation rate for the year is expected to drop from last year's 5.3% to 4% this year. The headline inflation rate is estimated at 3.5% after taking account of the effects of the one-off measures he proposes.
