Hong Kong Oct retail sales down 8.8% y-o-y, first single-digit fall since June 2019

[HONG KONG] Hong Kong's retail sales fell 8.8 per cent in October, the first single-digit fall since June last year, showing further signs of a recovery after coronavirus restrictions had slammed the brakes on spending and tourism in the global financial hub.

The drop compared with a revised 12.8 per cent decline in September and a 6.7 per cent fall in June 2019.

October's sales plummeted from a year earlier to HK$27.4 billion (S$4.69 billion), government data showed on Tuesday, falling for the 21st consecutive month.

In volume terms, retail sales slumped 9.3 per cent, compared with a revised 13.3 per cent fall in the previous month. It was also the first single-digit decline since June 2019.

"With the fourth wave of the local epidemic spreading widely and quickly, the business environment of the retail trade may deteriorate again in the near term," a government spokesman said.

For the first 10 months of 2020, the value of total retail sales fell 27 per cent, and 28.3 per cent by volume, from the corresponding 2019 period.

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Hong Kong leader Carrie Lam on Tuesday again urged residents to stay at home and avoid unnecessary family gatherings as the global financial hub scrambles to contain a rise in coronavirus cases.

Games centres, karaoke lounges and swimming pools will close from Wednesday, while the Ocean Park theme park and DisneyLand will also close.

The worsening situation in the city also prompted the government to extend the postponement of an air travel bubble with Singapore on Tuesday to beyond 2020.

Hong Kong's economy shrank 3.5 per cent in the third quarter compared with a year earlier as the coronavirus pandemic hammered consumer spending, trade and tourism, but at a slower pace as the outbreak had eased.

The city's tourist arrivals in October plunged 99.8 per cent from a year earlier to 7,817 visitors, the tourism board said, compared with a drop of 99.7 per cent in September.

Sales of jewellery, watches, clocks and valuable gifts, which depend heavily on mainland tourists, fell 26.6 per cent in October versus a revised 25.6 per cent plunge in September.

REUTERS