Hong Kong: Retail sales undershoot market expectations
October 4, 2012
In August, retail sales rose 3.2% over the same month last year. The print came in above the 1.4% expansion seen in July but undershot market expectations of a 3.5% increase. The faster expansion in August was driven by strong growth of supermarket sales as well as sales of clothing and footwear. In contrast, sales of food and non-alcoholic beverages as well as of jewellery and valuable gifts contracted, albeit at a slower pace. In seasonally adjusted terms, retail sales fell 0.1% in the three-month period ending in August compared to the previous period ending in May, which marked an improvement compared to the 0.9% drop recorded in July. The reading, nonetheless, marked the second consecutive decline. A government spokesman reiterated that favourable labour market conditions together with strong inbound tourism should render support to retail sales, but noted that "the persistent weakness in external trade and slower growth of the local economy may impact on consumer sentiment". The government expects full-year economic growth to range between 1.0% and 2.0%.