What: Hong Kong retail sales rose 5.9% in September, driven by tourism and luxury spending, while fashion and apparel sales declined.

Why it is important: The data highlights how tourism and changing consumer preferences are reshaping Hong Kong’s retail landscape, consistent with recent analyses.

Hong Kong’s retail sector posted a 5.9% year-on-year increase in sales for September, reaching HK$31.3 billion, marking the fifth consecutive month of growth. This expansion was largely fueled by a surge in tourism, particularly from Mainland China, and robust performance in luxury categories such as jewellery and watches, which saw a 9.1% rise. However, the overall positive figures conceal a significant downturn in fashion and apparel, with sales of clothing, footwear, and related products dropping by 10.2%, reversing gains from the previous month. While improved consumer sentiment and sustained inbound tourism are expected to support retail activity in the near term, the sector’s recovery remains uneven. The contrast between thriving luxury segments and struggling mass-market fashion highlights a shift in consumer behavior, as visitors and locals alike increasingly prioritize high-end purchases and experiences over everyday apparel. This evolving landscape underscores the need for retailers to adapt strategies to address changing preferences and the growing influence of tourism on retail dynamics. 

IADS Notes: Reports from August 2025 (“Hong Kong’s retail recovery accelerates as August sales rise by 3.8%”, South China Morning Post) and July 2025 (“Hong Kong retail sales gain 1.8% in July amid rising tourist traffic”, Fashion Network) confirm that rising tourist arrivals, especially from Mainland China, have not led to proportional retail spending, with luxury categories outperforming mass-market segments. Analyses from March 2025 (“Hong Kong retail sales decline continues”, Inside Retail) and November 2024 (“Nine months of decline: Hong Kong retail sales fall 7.3 per cent in November”, Inside Retail) further highlight the persistent underperformance of apparel and footwear, reflecting a fundamental shift in consumer behavior and the need for retailers to adapt to a changing retail environment.

Hong Kong retail sales rise 5.9% in September as fashion sector weakens