Inflation Rate in Hong Kong Climbs to 2.8% in May, Citizens Feeling the Pinch
The climbing inflation rate in Hong Kong is not alarming, although consumer prices are rising steadily. In a recent statistic result release, the inflation rate for May 2019 is 2.8%. The inflation rate was even lower than that in April 2019.
Inflation Rate in Hong Kong – Up or Down, It Goes With the Flow
Inflation is caused by two factors: demand-pull factor or cost-push factor. More often than not, demand-pull factors for a lot of inflation styles around the globe where there are more demands from the market than there is enough supply to keep up with the requests. The cost-push factor causes inflation by having plenty of oversupply without the needs to match it. A rise or drop in inflation is good for the economy as it stabilises purchasing power from the people.
Up Goes the Prices
Generally, consumer spending patterns have caused inflation. The more disposable money the average consumer has, the more they will spend. Overall, consumer prices have also gone up in May by 2.8%. Consumers are seen spending more on entertainment, eating out, housing and miscellaneous service and transportation. Collectively, this shows favour in a lifestyle change that consumers are going through; hence, suppliers of lifestyle products and services are fulfilling every dream they can think of.
Necessity Versus Trends
For the record, there have been decreases in spending on electricity, gas and water, durable goods, clothing and footwear. As such, these are collectively the necessities a consumer would require for day-to-day living. Lifestyle trends are rising and are seen to influence basic daily living needs gradually. Some patterns are deemed necessary, like the need for a communications device to stay connected or easily reach for help during emergencies.
As the cost of living continues to rise, some quarters of the consumer spectrum may feel the pinch whenever there is an increase in prices. Even when the prices affected are non-basic necessities, every consumer is bound to have desires to join in the trend of consumer spending. The government of Hong Kong is keeping an eye on price pressures, including social lifestyle, ensuring every consumer, including the lower-income group, gets to enjoy most of what the market has to offer.