Inflation rate hits eight-month high in September

The Consumer Price Index (CPI), which indicates overall inflation, increased in September by 0.47% compared to the previous year, the Statistics and Census Service (DSEC) reported in a statistical data release.

The result for September was the highest level since January, accelerating from 0.27% in the previous month.

According to the same DSEC information, the acceleration was mainly driven by faster price growth in housing and fuels (0.37% vs 0.33% in August), food and non-alcoholic beverages (0.56% vs 0.44%), recreation and culture (2.81% vs 2.45%), health (0.63% vs 0.58%), alcoholic beverages and tobacco (0.89% vs 0.69%), and education (1.67% vs 1.27%).

DSEC noted that the CPI increase was mainly led by higher rentals for dwellings and rising charges for dining out and takeaway.

Prices also rebounded in transport (0.44% vs -1.27%) and declined more slowly in clothing and footwear (-1.43% vs -2.09%). Conversely, miscellaneous goods and services growth slowed (1.14% vs 1.54%).

Analysed on a monthly basis, consumer prices edged up 0.1% in September, following a 0.11% rise in August.

Although September’s (0.47%) rate is the second-highest this year (after January’s 0.57%), it is still lower than the 0.59% seen one year ago.

As a regular trend in Macau, prices of goods and services experience more significant updates in September (with the start of the new academic year) and in January or February, with the beginning of the Lunar New Year.

Analysed by quarter, in the third quarter (Q3), the average Composite CPI rose by 0.29% year-on-year. Compared with the second quarter, the average Composite CPI increased by 0.23%. Considering the first nine months of this year, the average Composite CPI grew by 0.22% year-on-year.

Last year, the average inflation rate was 0.74%, including increases in food and non-alcoholic beverages. However, there was a significant drop in fresh or frozen pork prices and a considerable decrease in air transport costs.

Despite this official figure, which considers a series of selected goods and products, many residents perceive real inflation as significantly higher. This has led many companies, particularly larger-scale firms, to update wages by an average of 2.5% for employees earning more than MOP16,000 monthly.

Despite this, the government of Sam Hou Fai did not update the wages of civil servants this year, nor did it update the survival pensions and other subsidies directly linked to the inflation rate.

The disconnect between the general CPI and the reality for many residents has led several lawmakers to call for a special Composite CPI, specifically for the elderly, to address their needs.