Hong Kong: Retail sales record largest drop in nearly six years in January
March 3, 2015
In January, retail sales fell 13.9% over the same month last year, which followed the revised 1.4% decline tallied in December (previously reported: -1.3% year-on-year). While January’s drop represented the steepest contraction since February 2009, it also reflected the different timing of the Chinese New Year, which fell in mid-February this year and in late January in 2014. The print exceeded the 5.5% drop that markets had expected. The deterioration tallied in January was felt in almost all the subcategories of the index, with the jewelry and luxury goods sector and sales at supermarkets recording the largest contractions.
A government spokesman explained that in order to assess January’s drop, “it would be more meaningful to examine the retail sales figures for January and February combined for a clearer picture of the underlying trend” due to disruptions associated to the Chinese New Year. The official also noted that, “ahead, the near-term performance of retail sales will continue to hinge on the labour market conditions and inbound tourism growth.”
Retail sales rose a seasonally-adjusted 2.5% in the three-month period up to January compared to the previous three months ending in October. The reading followed the 3.9% increase recorded in the previous month.
Author: Carl Kelly, Economist