According to a report released by the U.S. Bureau of Labor Statistics, inflation for the city of Honolulu increased by only 1.1 percent during the first six months of 2014. This was the first time in 11 years that Honolulu was lower than the U.S. rate, which was 1.7 percent during this same period. Eugene Tian, the chief economists for the state of Hawaii's Department of Business, Economic Development and Tourism explained, "Hawaii inflation was higher than the U.S. for all these years until now. Inflation goes in cycles and now I think it will be lower than the U.S. for a while, maybe for 10 years. Low inflation is good for consumers because consumers will pay less and it also means that the real (inflation-adjusted) income for households is higher."
Tian added, "Low inflation is good for consumers but sometimes inflation is related to economic growth. Inflation always goes with economic growth but at this time we don't see that correlation yet because the economy is still doing good in the state." Department of Business, Economic Development and Tourism forecast that inflation will be up a total of 1.5 percent for 2014.
Source: Honolulu Star Advertiser, 8-20-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
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