Decline in Hong Kong retail sales in June less as forecasted
In this article (5)
Hong Kong retail sales in June fell – but not by as much as many were expecting.
Official figures from the Census and Statistics Department (C&SD) show a 6.7 per cent decline year-on-year in June, somewhat higher than the 1.4 per cent revised figure for May, but well short of the double-digit predictions some pessimists were picking late last month.
Year-to-date Hong Kong retail sales are down 2.6 per cent compared with a year ago.
June was the month when rolling protests began on Hong Kong Island, particularly affecting retailers in Admiralty, Wan Chai, Central and Causeway Bay. Watsons this week confirmed some of its stores in those areas had recorded double-digit declines in sales.
A government spokesman said that retail sales registered an enlarged decline in June, as local consumer sentiment turned more cautious and growth in visitor arrivals moderated.
He expects sales would remain subdued in the near term, as a weakened global and local economic outlook and other headwinds continue to weigh on consumption sentiment.
“The recent mass demonstrations, if continued, would also dent the retail business further,” he said.
Predictably, sales of jewellery, watches and valuable gifts in June were hit the hardest, plunging 17.1 per cent. Due to their high value, that category traditionally has the greatest impact on the overall figures.
Other categories to decline – in descending order of impact – were medicines and cosmetics (down 4.1 per cent); apparel (down 8.2 per cent); commodities in department stores (down 6 per cent); food, alcoholic drinks and tobacco (down 1.3 per cent); electrical and consumer durable goods (down 16.1 per cent); footwear and accessories (down 1.4 per cent); books, newspapers, stationery and gifts (down 4.5 per cent); Chinese drugs and herbs (down 0.1 per cent); and optical shops (down 11.9 per cent).
In contrast, supermarket sales increased by 1.6 per cent in June, while sales of other consumer goods not elsewhere classified rose by 0.3 per cent, and furniture and fixtures rose by 1.1 per cent.
C&SD said that after netting out the effect of price changes year-on-year Hong Kong retail sales in June decreased by 7.6 per cent and by 3.1 per cent in the year to June.
Questions & Answers
Q.Which retail categories were most significantly affected by the decline in June?
Which retail categories were most significantly affected by the decline in June?
Sales of jewellery, watches and valuable gifts were hit hardest, falling by 17.1 per cent. Electrical and consumer durable goods also saw a sharp decline of 16.1 per cent.
Q.What factors did the government spokesman identify as contributing to the subdued retail sales?
What factors did the government spokesman identify as contributing to the subdued retail sales?
The spokesman cited more cautious local consumer sentiment and moderated growth in visitor arrivals. A weakened global and local economic outlook also weighed on consumption.
Q.Were there any retail categories that experienced an increase in sales during June?
Were there any retail categories that experienced an increase in sales during June?
Yes, supermarket sales rose by 1.6 per cent. Sales of other consumer goods not elsewhere classified increased by 0.3 per cent, and furniture and fixtures by 1.1 per cent.
Q.How did the June retail sales decline compare to expectations from some analysts?
How did the June retail sales decline compare to expectations from some analysts?
The 6.7 per cent decline was less severe than the double-digit predictions some pessimists were making. It was, however, higher than May's revised 1.4 per cent fall.
Reader pulse
How will Hong Kong retail perform next quarter?
19,010 votes so far