Hong Kong’s retail slumps to 6-month low as stress looms

Bloomberg

Hong Kong’s retail sales grew at the slowest pace since July, with the government warning of further pressure ahead amid a surge in Covid cases.
The value of retail sales grew 4.1% in January from a year earlier, compared with the median estimate of 0.4% in a Bloomberg survey of economists. The volume of sales rose 1.7%. The Lunar New Year — which fell on February 1 this year — typically helps to boost retail spending, the Census and Statistics Department said in a statement.
The data covers consumer spending on goods but not on services, such as those on catering and medical care and entertainment, which account for over 50% of overall consumer spending.
“The figure has yet to fully reflect the impact of the fifth wave of local epidemic and the further tightening of anti-epidemic measures in the more recent period,” a government spokesperson said. “The retail sector will remain under immense pressure in the near term.”
Existing curbs on restaurants, gyms and other venues, and bans on flights from high-risk countries, rolled out in the past several weeks have failed to slow the spread of the omicron variant, with more than 61,000 infections diagnosed since the latest wave began. Those comments were echoed by Annie Yau Tse,
chairman of the Hong Kong Retail Management Association (HKRMA), who told reporters that the outlook remains dim for February and March after more stringent social distancing measures were rolled out and the government prepares for mass virus testing and a possible lockdown.
The report is the latest indication of economic pressure facing the Asian financial hub. Data showed economic activity contracted in February, plunging to a 22-month low. Economists are already predicting the economy shrank in the first quarter.