Second-quarter growth to be fastest in a year: HKU

Staff reporter

The University of Hong Kong expects the city's economy to grow by 2.5 percent year-on-year in the second quarter of 2025 -- the fastest in a year -- versus a 1.6 percent growth in the first quarter.

In a report, the APEC Studies Programme of the Hong Kong Institute of Economics and Business Strategy at HKU said it expects a 2.5 percent rise in real gross domestic product, boosted by mild inflation.

The report said the 1.6 percent growth in the first quarter has returned back to the level of the second quarter in 2023, indicating the negative effects caused by escalating Sino-US trade uncertainties.

Private consumption expenditure is expected to grow by 1.9 percent in the second quarter.

The unemployment rate will remain at 3.2 percent during the first two quarters in 2025, the report said.

HKU maintained a forecast that overall economic growth this year will lie between 2.5 percent and 3 percent. The government forecasts a growth of 2 percent to 3 percent for 2025.

Meanwhile, DBS Bank Hong Kong expects the city's business to show greater improvement in the second half of the year, noting the impact of the US tariffs is not too serious.

Hong Kong's overall economy may not see significant improvement until the second half of the year - near the end of the third quarter and in the fourth quarter, when the US is expected to cut interest rates, said Samuel Tse Ka-hei, an economist at DBS Bank Hong Kong.

Tse also believes that the US tariff measures will not seriously impact Hong Kong , as the proportion of re-exported goods passing through the city between China and the US has already declined significantly.