It’s official: Hong Kong’s retail sales in the first two months of 2015 were flat. There was no slump as previously, widely reported.
Hong Kong’s Census and Statistics Department (C&SD) figures on retail sales released Tuesday show February sales soared 14.9 per cent, reversing the 14.5 per cent fall widely reported in January.
Smarter analysts had factored in the effect of the change in timing of Lunar New Year this year, a huge driver of retail sales.
When both months trading are compared to the same two months of 2014, the difference was a decline of two per cent – and then luxury watches and jewellery is the primary contributing category.
In the official C&SD statement, a government spokesman noted that after removing the distortions caused by the difference in timing of the Lunar New Year holidays, retail sales were “nearly flat in volume terms compared to the same period last year”.
“The subdued performance was mainly due to the notable fall in the sales of jewellery, watches and clocks and valuable gifts, conceivably reflecting the weak tourist spending on big-ticket items. Yet, the performance of many items that are more closely related to local consumption showed some relative improvement from December 2014.”
The value of total retail sales in February 2015, provisionally estimated at HK$46.6 billion, increased by 14.9 per cent compared with the same month in 2014. The revised estimate of the value of total retail sales in January 2015 decreased by 14.5 per cent from a year earlier.
“For the first two months of 2015 taken together, total retail sales decreased by 2.0 per cent in value compared with the same period in 2014.”
After netting out the effect of price changes over the same period, the volume of total retail sales in February 2015 increased by 18.2 per cent over a year earlier. The revised estimate of the volume of total retail sales in January 2015 decreased by 13.8 per cent from a year earlier. For the first two months of 2015 taken together, total retail sales decreased by 0.3 per cent in volume compared with the same period in 2014.
“In interpreting these figures, it should be noted that retail sales tend to show greater volatility in the first two months of a year due to the timing of the Lunar New Year. Local consumer spending normally attains a seasonal high immediately before the Festival. As the Lunar New Year fell on February 19 this year but on January 31 last year, it is more appropriate to analyse the retail sales figures for January and February taken together in making year-on-year comparison.”
By broad type, comparing the combined total sales for January and February 2015 with the same period last year, the value of sales of commodities in supermarkets increased by 3.7 per cent, medicines and cosmetics by 8.3 per cent, food, alcoholic drinks and tobacco by 15.3 per cent, electrical goods and photographic equipment by 12.7 per cent, footwear, allied products and other clothing accessories by five per cent, furniture and fixtures by 8.9 per cent and Chinese drugs and herbs by 4.3 per cent. The value of sales of other consumer goods, not elsewhere classified, remained virtually unchanged.
In contrast, the value of sales of jewellery, watches and clocks, and valuable gifts decreased by 15.9 per cent in the first two months of 2015 compared with the same period last year. This was followed by sales of wearing apparel down 4.7 per cent, commodities in department stores by 0.8 per cent, “miscellaneous consumer durable goods” by 15.1 per cent, books, newspapers, stationery and gifts by 3.8 per cent and optical shops by 1.4 per cent.
“Based on the seasonally adjusted series, the value of total retail sales decreased by 1.6 per cent in the three months ending February 2015 compared with the preceding three-month period, while the volume of total retail sales decreased by 1.1 per cent,” said the C&SD statement.
The spokesman said that, looking ahead, the near-term performance of retail sales is still subject to uncertainties, depending on the labour market conditions as well as inbound tourism growth.
“Besides, we also need to closely monitor how various uncertainties in the external environment may affect local consumption sentiment going forward.”
More detailed statistics are available in the Report on Monthly Survey of Retail Sales, downloadable here.
