Hong Kong: Further signs of a turnaround in retail sales appear in June
August 2, 2017
For a second consecutive month and only the third month in nearly two years, retail sales rose in June. After edging up by 0.6% year-on-year in May, sales at retail outlets grew by 0.4% in June. Although growth in sales volumes eased slightly from a month earlier, likely the result of a decline in inbound tourist arrivals in the month, recent dynamics suggest the retail sector is in the earliest stages of its long-awaited turnaround.
Growth was uneven across outlet types, with department store sales going unchanged from a year earlier while clothing and footwear retailers experienced sales growth. Moreover, both supermarkets and fuel retailers recorded more moderate declines from a month earlier. Food, alcoholic drinks and tobacco sales decelerated for another month, while jewelry sales recorded a decline—likely the result of fewer luxury-focused mainland Chinese shoppers in June.
The three-month moving average of seasonally-adjusted volumes of retail sales ending in June increased 2.5% versus the previous period. This result followed on the 4.5% increase seen in the three-month period ending in May.
A government spokesperson noted that, “the near-term performance of retail sales would depend on the pace of recovery in inbound tourism and the extent of improvement in the external economic environment.”
Author: Christopher Thomas, Economist