China’s economic slowdown is rippling through Hong Kong, with the city’s retail sales rising at the slowest pace since 2009 as shoppers visiting from the mainland trimmed their spending.
Sales climbed 11.4 per cent in April from a year earlier, the Hong Kong government said in a statement on its website yesterday. That is the smallest annual gain since October 2009, excluding January and February numbers distorted by the Chinese New Year holiday. The median estimate in a Bloomberg survey of economists was for a 16.4-per-cent increase.
China’s economy is cooling as Premier Wen Jiabao extends a crackdown on speculation in the housing market and Europe’s sovereign-debt crisis caps exports.
In Hong Kong, declines in the benchmark Hang Seng Index since the end of February have damped confidence and demand as households see the value of their assets dwindle.
“Less extravagant spending by mainland shoppers is part of the issue,” said Ms Donna Kwok, a Hong Kong-based economist at HSBC Holdings.
“Local households are also being more prudent because of increasing turbulence in financial markets.”
The smaller-than-estimated gain in retail sales came the same day as jewellery maker and retailer Graff Diamonds shelved a $1 billion (S$1.3 billion) initial public offering (IPO) in Hong Kong, blaming “consistently declining stock markets”.
Sales of jewellery, watches and valuable gifts in Hong Kong rose an average of 17 per cent in the first three months of the year compared with a year earlier. That is down from growth of about 37 per cent in the last quarter last year, the data show.
Category: Hong Kong