Hong Kong retail sales likely to have recovered slightly in March, GDP to have grown 1.8 pct in Q1 2019

The domestic and external sectors of Hong Kong are likely to have rebounded a bit in March. According to a DBS Bank research report, the value of retail sales is expected to have dropped 5.5 percent year-on-year in March, as compared with the fall of 10.2 percent in the prior month. This might be slightly because of the positive wealth effect from the buoyant equity market. Recovery in inbound tourism might also render some support to the retail sector alongside a stabilizing CNY exchange rate.

Meanwhile, the real GDP growth of Hong Kong is likely to have rebounded a bit to 1.8 percent year-on-year in the first quarter of this year from 1.1 percent seen in the prior quarter, said DBS Bank. However, this is much below the 10-year trend growth of 2.8 percent.

“The seemingly modest expansion, however, is partly a result of the high base comparison of 1Q18, where the Easter holiday fell in Mar last year. We expect the Hong Kong economy will recover further and grow by 2.5 percent for FY2019”, added DBS Bank.