Hong Kong: Drop in retail sales moderates in September
November 3, 2016
A strengthening U.S. dollar—to which the Hong Kong dollar is pegged—and China’s economic downturn continued to drag on the island’s retail sales performance. In September, retail sales continued to decline for the nineteenth consecutive month, decreasing 3.9% from the same month last year. This, however, was a milder drop from August’s 10.9% plunge and also marked the smallest decrease in eight months. Although the reading still reflected plummeting sales of luxury products and consumer durable goods, it partially benefited from increased trading in clothing products and accessories.
Retail sales decreased 0.8% in the three-month period ending in September compared to the three-month period ending in June. September’s figure was an improvement from August’s 1.7% drop.
A government spokesman indicated that, “retail sales showed a visibly narrower year-on-year decline in September, conceivably due partly to a reduced drag from the smaller decline in visitor arrivals in that month and partly to some improvement in consumer sentiment amid a somewhat more stable external environment. Looking ahead, the near-term outlook for retail sales is still subject to uncertainty, depending on the performance of inbound tourism as well as the extent to which local consumer sentiment will be affected by various external uncertainties.”
Author: David Ampudia, Economist