Retail sales miss target by hairline

Retail sales rose 13 percent in September from a year earlier, slightly missing a 13.8 percent growth projection despite continued improvements in inbound tourism and private consumption.

The value of retail sales increased to HK$31.8 billion in a 10th consecutive month of rises, according to provisional figures from the Census and Statistics Department.

September's increase was smaller than a revised growth of 13.7 percent in August.

In terms of volume, retail sales climbed 10.1 percent in September, compared with 11 percent in August. Online sales rose by 22 percent to HK$3.5 billion during the month, accounting for 11 percent of the total retail sales.

The performance was affected by typhoons and flooding in the first half of September- despite large-scale activities organized by the government later in the month, said Bond Law, an executive director of the Hong Kong Retail Management Association.

Law expects local retail sales to see a single-to-low-double-digit growth this month amid weakening demand.

In October, Law said local consumption remained weak as there is a continuous trend of Hongkongers heading north to cities such as Shenzhen despite increased visitor arrivals to Hong Kong during National Day holiday last month.

Although half of the retailers surveyed saw growth during the golden week holiday, as much as 90 percent said sales were not at the same level as in the same period of 2018, according to HKRMA.

In September, government data showed that sales of jewelry, watches, clocks, and valuable gifts grew by 27.3 percent from the previous year while medicines and cosmetics soared 50.6 percent year on year, suggesting the impact of visitors. For the first nine months, retail sales advanced by 18.6 percent in value from the same period last year, with a 16.5 percent jump in volume during the period.

The further recovery of visitor arrivals should continue to benefit the retail sector, said a government spokesman.

Improvement in household income and the government's initiatives, such as the Night Vibes Hong Kong campaign, should provide support, he added.

The campaign, launched in September, involved night markets, late-night film screenings, and live music events in a bid to boost the economy.

caroline.zheng@singtaonewscorp.com