October trade plunges by double digits

Hong Kong's exports and imports contracted by double digits in October from a year ago, the latest sign of a severe economic downturn.

Exports plunged 10.4 percent last month to HK$374.7 billion from a year earlier, falling for the sixth consecutive month and outpacing a 9.1 percent drop in September, the Census and Statistics Department said yesterday.

Imports fell 11.9 percent to HK$395.5 billion last month from the previous year, after a decrease of 7.8 percent the month before.

The city saw double-digit drops for the second time in trade this year after it recorded a 14.3 percent decline in exports and a 16.3 fall in imports in August - the biggest drop since the coronavirus pandemic broke out in January 2020.

In the January-October period, total exports dropped by 4.4 percent from a year ago while imports decreased by 3.7 percent year-on-year over the same period.

"Hong Kong's export performance will remain under immense pressure, as elevated inflation and further monetary policy tightening in major advanced economies continue to suppress global demand in the short term," a government spokesman said, adding that the rapid fall in October came as the external environment deteriorated and disruptions to cross-boundary land transportation continued.

Exports to the mainland, the United States, and the European Union recorded double-digit declines, while exports to most other major Asian markets saw a worsened performance, he said.

The city recorded a 12.9 decline in exports to the mainland in October. At the same time, it saw a 21.1 and 19.5 percent drop for exports to Germany and the US, respectively.

Hit by a slump in trade, Hong Kong's economy contracted 4.5 percent in the third quarter of this year from the same period a year earlier, the government announced this month.

Meanwhile, the government downgraded its forecast for the local economy this year to a 3.2 percent contraction.

That's much more pessimistic than an earlier prediction of between a 0.5 percent drop to a 0.5 percent expansion given in August.