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Hong Kong inflation rises to 1.9% in September as unemployment edges up to 3.9%

Published Data as of Hong KongMacro & households
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Key points

Implications for lenders

For lenders in Hong Kong, underemployment of 2.0%, concentrated in retail and catering, may mean income verification for shift-based workers needs to look at recent hours rather than contracted pay. With the Base Rate at 4.25% and inflation at 1.9%, real repayment burdens stay high, which collections teams may watch among borrowers in consumer-facing jobs.

Implications

ExecutivesRising underemployment in food and beverage and retail points to income pressure in consumer-facing jobs even while headline unemployment moves only slightly.
InvestorsModerate inflation alongside a high base rate keeps real borrowing costs elevated for Hong Kong households.
OperatorsHigher utility bills and fewer working hours in retail and catering may tighten monthly cash flow for borrowers in those sectors.

Facts

The Census and Statistics Department (C&SD) reported on 22 October 2026 that the Composite Consumer Price Index rose 1.9% year on year in September, up from 1.7% in August. 1 Netting out the government's one-off relief measures, underlying inflation was 2.1%, up from 1.9% in August. 2 Over the first nine months of 2026 the Composite CPI averaged 1.7%. 3

The largest increase was in electricity, gas and water, at 12.9%. 4 By household group, CPI(A), covering the lowest-expenditure households, rose 1.4%, up from 1.2% in August, while CPI(C), covering the highest-expenditure households, rose 2.3%, up from 1.9% in August. 5 6 A government spokesman said elevated international oil prices would keep fuel-related components under upward pressure, while overall inflation should remain moderate.

The same day, C&SD's provisional figures put the seasonally adjusted unemployment rate for July–September 2026 at 3.9%, up from 3.8% in June–August. 7 Underemployment was 2.0%, up from 1.9% in June–August. 8 The number of unemployed persons was about 155,000, up about 1,100 from June–August. 9 Unemployment rose in social work and in warehousing and transport support services; underemployment rose mainly in food and beverage services and retail, through reduced hours or shifts.

Analysis

Headline inflation had held at 1.7% in August, unchanged from 1.7% in July, so September is the first rise after two months at that level. 10 The rise is concentrated in energy-linked items rather than food or housing, and it is falling more on higher-spending households than on the lowest-spending group.

Against Singapore, Hong Kong's price pressure is lower but its labour market is looser: Singapore's headline inflation was 2.3% in August, while its seasonally adjusted unemployment rate was 1.9% in June. 11 12 With the HKMA Base Rate at 4.25%, Hong Kong borrowers face borrowing costs well above current inflation, so real debt burdens are not being eroded by prices. 13

Counterpoints and uncertainties

The labour figures are provisional and the changes are small, so they may be revised. Underlying inflation depends on how one-off government relief is netted out, and fuel-related prices could reverse if oil prices fall. The government expects hiring to be supported by visitor arrivals and business sentiment, which would ease the pressure described here.

Key figures

  1. Headline CPI inflation (Composite CPI), y/y: 1.9% (up from 1.7% in August). Year-on-year change in the Composite Consumer Price Index, Census and Statistics Department. Hong Kong, all households covered by the Composite CPI. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  2. Underlying CPI inflation, y/y: 2.1% (up from 1.9% in August)
    Hong Kong's official underlying measure removes one-off government relief effects; it is not a food-and-energy-excluded core index.
    . Year-on-year change in the Composite CPI netting out the effects of the Government's one-off relief measures. Hong Kong. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  3. Composite CPI inflation, January–September average: 1.7%. Average year-on-year rate of the Composite CPI over the first nine months of 2026, C&SD. Hong Kong. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  4. Electricity, gas and water prices, y/y: 12.9%. Year-on-year change in the electricity, gas and water component of the Composite CPI, C&SD. Hong Kong. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  5. CPI(A) inflation, y/y: 1.4% (up from 1.2% in August). Year-on-year change in CPI(A), which covers the households with the lowest expenditure, C&SD. Hong Kong, lower-expenditure households. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  6. CPI(C) inflation, y/y: 2.3% (up from 1.9% in August). Year-on-year change in CPI(C), which covers the households with the highest expenditure, C&SD. Hong Kong, higher-expenditure households. Basis date: 30 Sep 2026. Source: Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)
  7. Unemployment rate (seasonally adjusted, 3-month): 3.9% (up from 3.8% in June–August)
    Provisional figures for the three months July–September 2026, released by C&SD on 22 October 2026.
    . Seasonally adjusted unemployment rate for July–September 2026, C&SD. Hong Kong labour force. Basis date: 30 Sep 2026. Source: Dimsum Daily (2026-10-22): Hong Kong jobless rate edges up to 3.9% (citing C&SD provisional figures)
  8. Underemployment rate (3-month): 2.0% (up from 1.9% in June–August)
    Provisional figures for the three months July–September 2026, released by C&SD on 22 October 2026.
    . Underemployment rate for July–September 2026, C&SD. Hong Kong labour force. Basis date: 30 Sep 2026. Source: Dimsum Daily (2026-10-22): Hong Kong jobless rate edges up to 3.9% (citing C&SD provisional figures)
  9. Unemployed persons (3-month, not seasonally adjusted): about 155,000 (up about 1,100 from June–August)
    Provisional figures for the three months July–September 2026, released by C&SD on 22 October 2026.
    . Number of unemployed persons in July–September 2026, not seasonally adjusted, C&SD. Hong Kong labour force. Basis date: 30 Sep 2026. Source: Dimsum Daily (2026-10-22): Hong Kong jobless rate edges up to 3.9% (citing C&SD provisional figures)
  10. Headline CPI inflation (Composite CPI), y/y: 1.7% (unchanged from 1.7% in July). Year-on-year change in the Composite Consumer Price Index, Census and Statistics Department. Hong Kong, all households covered by the Composite CPI. Basis date: 31 Aug 2026. Source: Hong Kong Government press release: Consumer Price Indices for August 2026 (2026-09-23, C&SD)
  11. Headline CPI inflation (CPI-All Items): 2.3% (up from 2.2% in July). Year-on-year change in the consumer price index. Singapore, national. Basis date: 31 Aug 2026. Source: MTI: Consumer Price Developments in August 2026 (2026-09-23)
  12. Unemployment rate, overall: 1.9%. Seasonally adjusted unemployment rate, overall. Singapore labour market (MOM). Basis date: 30 Jun 2026. Source: MOM: Labour Market Report 2Q 2026
  13. HKMA Base Rate: 4.25% (up 25 bp from 4.00%)
    Figure as reported by on.cc from the HKMA announcement of 17 September 2026.
    . Base Rate of the Discount Window, set by a pre-set formula. Hong Kong Monetary Authority. Basis date: 17 Sep 2026. Source: on.cc (2026-09-17), reporting the HKMA announcement

Sources

  1. Hong Kong Government press release: Consumer Price Indices for September 2026 (2026-10-22, C&SD)primary
  2. Dimsum Daily (2026-10-22): Hong Kong inflation edges up in September (citing C&SD)
  3. The Standard (2026-10-22): Hong Kong CPI rises 1.9pc in September
  4. Dimsum Daily (2026-10-22): Hong Kong jobless rate edges up to 3.9% (citing C&SD provisional figures)
  5. The Standard (2026-10-22): Hong Kong rate hits 3.9pc with 155,000 out of work in July–Sep
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A Japanese version of this article is available: 日本語版

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