Decrease in retail sales expected

Retail sales in Hong Kong are projected to fall for the rest of the year following an 11% increase in value in June.

The Census and Statistics Department traced the year-on-year increase to $34.8 billion to resilient local demand and an increase in the number of tourists, The rise in value was faster than May's 8.7% increase.

By volume, retail sales rose 8.5% in June from a year earlier, rising from May's 5.7% increase.

Despite the latest uptick up in retail sales, economists said growth is likely to slow down in the next months due to volatile global financial markets.

They also expect the average expenditure per tourist from mainland China, a key cause of retail sales growth, to drop because of China's worsening economic slowdown.

Analysed by broad type of retail outlet and comparing June 2012 with June 2011, the volume of sales of miscellaneous consumer durable goods increased the most, by 103.3%.

This was followed by increases in volume of sales of motor vehicles and parts (40.4%); electrical goods and photographic equipment (23.5%); footwear, allied products and other clothing accessories (10.6%); commodities in supermarkets (8.7%); apparel (8%); commodities in department stores (6.8%); miscellaneous consumer goods (3.7%); and, food, alcohol, and tobacco (1.6%).

The volume of sales of furniture and fixtures decreased 8.2%. This was followed by sales of jewelry, watches and clocks, and valuable gifts (-3.1%); and fuels (-2.2%).

The revised estimate of the value of total retail sales in May, at $36 billion, increased 8.7% over May 2011, while the volume of total retail sales increased 5.7%.