Hong Kong’s retail sales of jewelry, watches and other valuables in January 2019 were up 4.7% year-on-year after falling by 5% in December, according to statistics released by the HK government, as increased tourism from the Mainland and early Lunar New Year shopping lifted overall retail sales. The Hong Kong Tourism Board reported that January tourist arrivals rose to 6.78 million, up 27% from January last year, with the number of visitors from the Mainland - good for more than 80% of the total visitors - increasing by 35%.
The increase in the sheer number of visitors, coupled with the impact of pre-season shopping, pushed retail sales up 7.1% in value to US$48.1 million and 6.9% in volume terms. This was the sharpest increase recorded in the past five months. However, given that the Lunar New Year fell early this year, on February 5 (compared with February 16 last year), the holiday season shopping commenced earlier than in 2018. As a result, a more accurate assessment of overall consumer sentiment will only emerge when cumulative sales over the first two months of the year are compared, analysts said. “The outlook for [the] retail sales business is still subject to uncertainty,” a government analyst commented.. “While the full employment situation in the local labor market and the sustained expansion in inbound tourism should provide support, consumption sentiment will be affected by the unsteady external environment.” Overall sentiment is still cautious due to uncertainty amidst the ongoing US-China tariff war.