Decline in Hong Kong retail sales in June less than feared

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Photo by Jimmy Chan from Pexels

By: Inside Retail Asia

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 percent decline year-on-year in June, somewhat higher than the 1.4 percent 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 percent 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 jewelry, watches and valuable gifts in June were hit the hardest, plunging 17.1 percent. 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 percent); apparel (down 8.2 percent); commodities in department stores (down 6 percent); food, alcoholic drinks and tobacco (down 1.3 percent); electrical and consumer durable goods (down 16.1 percent); footwear and accessories (down 1.4 percent); books, newspapers, stationery and gifts (down 4.5 percent); Chinese drugs and herbs (down 0.1 percent); and optical shops (down 11.9 percent).

In contrast, supermarket sales increased by 1.6 percent in June, while sales of other consumer goods not elsewhere classified rose by 0.3 percent, and furniture and fixtures rose by 1.1 percent.

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 percent and by 3.1 percent in the year to June.

 

The article is first published HERE.