Hong Kong Retail June 2016

Hong Kong

Retail sales fall sharply again in June

In June, retail sales declined for the eighth consecutive time, falling 9.7% over the same month last year. This represented a sharper contraction than the 8.8% decrease registered in May and also a poorer performance than the 8.5% decline the market had expected. In the first half of the year, retail sales recorded a 10.1% fall compared to the same period last year (H2 2015: -2.0% year-on-year).

Looking at the data in detail, June’s harsher decrease was driven by a steep plunge in the sales of miscellaneous consumer durable goods and jewelry, which could not be offset by the increase in sales of medicine and cosmetics, as well as food, alcoholic drinks and tobacco.

Retail sales increased a seasonally-adjusted 1.9% in the three-month period ending in June compared to the three-month period ending in March. June’s figure represents an improvement over the 0.3% increase recorded in May.

A government spokesman indicated that, “retail sales volume in June was still notably lower than the year-ago level, reflecting the fall in visitor spending and the more cautious consumer sentiment amid subpar economic conditions. Nevertheless, on a seasonally adjusted basis, retail sales improved moderately in the second quarter compared to the first quarter. Looking ahead, the near-term retail sales performance will still depend on the performance of inbound tourism as well as the extent to which consumer sentiment will be affected by the lingering uncertainties about the economic outlook.”

FocusEconomics Consensus Forecast panelists expect retail sales to contract 5.6% in 2016, which is down 0.1 percentage points from last month’s projection. Next year, the panel sees retail sales growing 0.7%.

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Hong Kong Retail Chart

Hong Kong Retail June 2016 2

Note: Year-on-year changes and annual average variation in %.
Source: Census and Statistics Department Hong Kong.

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