Hong Kong: Retail sales growth moderates in March
May 5, 2015
In March, retail sales increased 0.8% over the same month last year, moderating from the exceptional 18.2% increase tallied in February that was due to Chinese New Year holiday. The anemic growth rate can be partly explained by tighter visa rules for Shenzen residents, resulting in a drop in tourists from mainland China. The sluggish increase tallied in March was mainly the result of a slowdown in sales of jewelry and wearing apparel which was slightly more than offset by increased sales of electrical goods as well as food, alcoholic drinks and tobacco.
A government spokesman explained that, “the performance of retail sales remained sluggish in March. Most types of retail outlets recorded year-on-year declines in sales, conceivably reflecting the slowdown in inbound tourism. Retail outlets selling certain consumer durable goods saw some notable increases in sales, mainly helped by the launch of certain smartphone models.” The official also noted that, “The retail sales performance in the near term is likely to be constrained by the weaker performance of inbound tourism, although the stable labour market conditions should still render support to local consumer sentiment.”
Retail sales fell a seasonally-adjusted 1.0% in the three-month period ending in March compared to the three-month period ending in December 2014. The result represented a slight increase from the 1.1% contraction recorded in the previous month.
Author: Eric Denis , Economist