Hong Kong retail sales stable
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Hong Kong retail sales are not as depressing as many luxury retailers would have us believe.
Figures for June released unusually late in the day on Friday show a year on year decrease of just 0.4 per cent, a figure low enough to adjust the first half year’s sales slippage to just 1.6 per cent – from the 2.3 per cent for the first four months.
But take the effect of inflation out of the equation, and the territory’s retail sales increased by 4.4 per cent in June 2015. In volume terms, sales rose 4.7 per cent in the month, and for the first half of the calendar year are up by 4.7 per cent.
Basically, it is the luxury sector – high end fashion, watches and jewellery – which is suffering the most. For most other retailers, there’s nowhere near the same level of decline.
A Census and Statistics Department (C&SD) spokesman indicated that retail sales volume grew moderately further in June over a year earlier.
“The fall in the sales of jewellery, watches and clocks, and valuable gifts narrowed, while retail outlets selling certain consumer durable goods registered visible growth in sales.”
But the C&SD spokesman maintained a conservative outlook for the remainder of the year.
“Looking ahead, the near-term performance of retail sales is still subject to uncertainties, depending on inbound tourism growth and any spillover to consumption sentiment from the recent stock market volatility.
“The fall in the sales of jewellery, watches and clocks, and valuable gifts narrowed, while retail outlets selling certain consumer durable goods registered visible growth in sales.”
“Nevertheless, the stable job and income conditions should provide some support. The Government will monitor closely how these factors, as well as the various uncertainties in the external environment, would affect the retail business going forward,” he said.
By broad retail category, and in descending order of value of sales, the value of sales of jewellery, watches and clocks, and valuable gifts decreased by 10.4 per cent in June 2015 compared with a year earlier.
This was followed by sales of commodities in supermarkets (down 0.5 per cent), wearing apparel (down 3.8 per cent), commodities in department stores (down 3.3 per cent), medicines and cosmetics (down 4.2 per cent), footwear, allied products and other clothing accessories (down 8.4 per cent), furniture and fixtures (down 3.7 per cent), books, newspapers, stationery and gifts (down 9.5 per cent) and Chinese drugs and herbs (down 4.2 per cent).
On the other hand, the value of sales of electrical goods and photographic equipment increased by 21.4 per cent in June 2015 compared with a year earlier. This was followed by sales of food, alcoholic drinks and tobacco (up 3.6 per cent) and optical shops (up 0.4 per cent).
Based on the seasonally adjusted series, the value of total retail sales decreased by 4.4 per cent in the second quarter of 2015 compared with the preceding quarter, while the volume of total retail sales decreased by three per cent.
Questions & Answers
Q.Which retail sectors are experiencing the most significant decline in Hong Kong?
Which retail sectors are experiencing the most significant decline in Hong Kong?
The luxury sector, including high-end fashion, watches, and jewellery, is suffering the most. Sales of jewellery, watches and clocks, and valuable gifts decreased by 10.4 per cent in June 2015 compared to the previous year.
Q.What is the overall trend for Hong Kong's retail sales when inflation is considered?
What is the overall trend for Hong Kong's retail sales when inflation is considered?
When the effect of inflation is removed, Hong Kong's retail sales actually increased by 4.4 per cent in June 2015. In volume terms, sales rose by 4.7 per cent in June and for the first half of the calendar year.
Q.What factors could influence the retail sales performance for the remainder of the year?
What factors could influence the retail sales performance for the remainder of the year?
The Census and Statistics Department expects the near-term performance to depend on inbound tourism growth and any impact on consumption from recent stock market volatility. Stable job and income conditions are expected to provide some support.
Q.Were there any retail categories that saw an increase in sales during June 2015?
Were there any retail categories that saw an increase in sales during June 2015?
Yes, the value of sales for electrical goods and photographic equipment increased significantly by 21.4 per cent. Sales of food, alcoholic drinks, and tobacco also rose by 3.6 per cent, and optical shops saw a 0.4 per cent increase.