What: Hong Kong's retail sales dropped by 10.1% in August compared to the previous year, marking the sixth consecutive month of decline.

Why it is important: The persistent decline in retail sales highlights ongoing economic challenges, influenced by a strong Hong Kong dollar, changing consumer habits, and increased travel abroad.

In August 2024, Hong Kong's retail sales fell by 10.1% year-on-year to HKD 29.2 billion (USD 3.8 billion), continuing a trend of declining sales over six months. Factors contributing to this decline include a strong Hong Kong dollar and shifts in consumer spending patterns, with more residents traveling abroad during holidays. Despite a slight increase in visitor arrivals, particularly from mainland China, the retail sector remains under pressure. Sales of high-value items like jewelry and watches saw a significant drop of 24%, while clothing and accessories sales fell by 12.3%. The government anticipates that easing exchange rates and potential U.S. interest rate cuts may offer some relief to the sector.

Hong Kong retail sector faces decline amid economic challenges