Hong Kong retail sales fall 14.6% in February, ending 12 months of growth

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Customers wearing face masks line up to pay at a supermarket, ahead of mass testing for the coronavirus disease (COVID-19), in Hong Kong, China March 2, 2022. REUTERS/Tyrone Siu

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  • Tourist arrivals in February fall more than 52% year-on-year compared to growth of 61.7% in January
  • Government sees retail sector facing ‘notable pressure’ in short term

HONG KONG, March 31 (Reuters) – Hong Kong’s retail sales fell in February after 12 consecutive months of growth as a wave or COVID-19 infections hit the city and anti-epidemic measures were weakened consumer sentiment and reduced the number of people going shopping.

Retail sales in February fell 14.6% from a year earlier to 25.2 billion Hong Kong dollars ($3.22 billion), official data showed Thursday. This compares to a revised increase of 4% in January and a decline of 13.7% in the last decline in January 2021.

This is the biggest drop since July 2020, during the early months of the pandemic, when sales fell 23.1%.

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“While the local outbreak has shown signs of easing in recent times, the retail sector will continue to face noticeable pressure in the near term,” a government spokesperson said, adding that the news series of electronic consumer checks in April should provide support to the retail sector. .

In terms of volume, retail sales in February fell 17.6% from a year earlier, compared to a revised 1.5% growth in January, and it was the biggest drop since July. 2020, when it fell 23.8%.

Earlier this year, Hong Kong implemented its most draconian measures as the Omicron variant caused a dramatic spike in infections and as a result, the city’s businesses and economy are reeling from the widespread lockdowns.

Hong Kong’s border has been effectively closed since 2020 with few flights able to land and virtually no passengers allowed through, isolating a city that had built a reputation as a global financial and travel hub.

The economy is expected to contract in the first quarter, breaking four quarters of recovery, Finance Secretary Paul Chan said on his blog last Sunday.

The seasonally adjusted unemployment rate rose to 4.5% in the December-February quarter, the government said, adding that the outlook is clouded by the battle to bring the outbreak under control.

Sales of valuable jewelry, watches, clocks and gifts, which before the pandemic relied heavily on mainland tourists, fell 33.6% in February after rising 7.1% in January, the data showed.

Clothing, footwear and related products plunged 39% in February from a revised jump of 6.2% in January.

February tourist arrivals fell more than 52% from a year earlier to 2,626. That compares with a 61.7% jump in January.

At least online retail sales, measured by value, jumped 50% in February from a year earlier compared to January’s revised 30.7% growth.

($1 = HK$7.8294)

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Reporting by Donny Kwok and Twinnie Siu; Editing by Simon Cameron-Moore

Our standards: The Thomson Reuters Trust Principles.

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