HK private sector activity contracts for fifth month as confidence, orders slid

Hong Kong’s private sector saw a continuous deterioration for the fifth consecutive month in June, marked by weakening business confidence, falling new orders, and declining selling prices, according to S&P Global.

S&P Global Hong Kong SAR Purchasing Managers’ Index, a composite indicator of business performance, fell 1.2 points to 47.8 in June from 49 in May, the largest monthly drop since April 2022.

A level below 50 indicates contraction in the sector.

Usamah Bhatti, economist at S&P Global Market Intelligence, said in a research note that the sinking of overall business confidence to the lowest level in close to five years was a particular point of concern.

New orders in the city’s private sector fell for a fifth straight month in June. Meanwhile, in response to easing inflationary pressures, the city's private sector companies lowered their selling prices for the third time in four months.

Improvements in confidence and demand will be needed before a recovery can take place, amid a weaker global economic and trade environment, Bhatti said.

STAFF REPORTER