What: Hong Kong’s retail sales unexpectedly dropped in November by the most in 8 months as the city struggled to shake off the lingering effects of its pandemic-era controls and a slowing global economy.

Why it is important: Hong Kong's retail sales value fell 4.2% from a year ago. Sales volume decreased 5.3%, compared with economists’ expectations of a 3.3% rise, with a government spokesman saying in a statement that the retail business had “softened” in November.

Hong Kong’s retail landlords are bracing for a further squeeze on the lowest rents in more than a decade as tenants seek relief in the aftermath of the city’s worst Covid outbreak. The drop that month may be due to Hong Kong’s reopening of its international border.

A long-awaited reopening of Hong Kong’s border with mainland China is likely to boost the economy and lift retail sales in the coming months. City leaders have said they intend to start that reopening by the middle of this month.

Hong Kong’s retail sales surprise drop in November