Apr. 23, 2008 (China Knowledge) - Hong Kong's consumer prices grew 4.2% year-on-year in March, down from 6.3% in February but still rather high, Hong Kong Census and Statistics Department said.

According to the department, the fall in inflation was due to the low base of comparison arising from the waiver of public housing rentals in February.

Recently, the government announced a one-off rate concession from January to March in order to net out the effect of the rental waiver. The underlying inflation rate was 5.3%, larger than February's 5.1%, the department added.

The main reason of the larger underlying inflation rate was the enlarged rise in private housing rentals, prices of women's clothing and the cost of meals bought away from home.

The rise in food prices, driven by global food inflation, was greatly responsible for the pick-up in inflationary pressure in recent months. The sustained rapid expansion of local economic activities also added pressure on prices and costs.

Hong Kong's price of food (excluding meals bought away from home) increased 17.2% in March.