November 1, 2018 / 9:44 AM / 16 days ago

Hong Kong Sept retail sales grow at slowest pace in 15 months

    * Sept retail sales value up 2.4 pct y/y, volume up 1.4 pct
y/y
    * Jan-Sept retail sales value up 11.1 pct y/y, Q3 down 2.9
pct q/q
    * Sept tourist arrivals rise 1.8 pct y/y, Jan-Sept up 9.5
pct
    * External uncertainty, weak asset markets may hit
sentiment- govt

    By Donny Kwok
    HONG KONG, Nov 1 (Reuters) - Hong Kong's retail sales in
September grew at their slowest pace in 15 months, government
data showed on Thursday, with outlook clouded by external
headwinds including mounting trade friction between Beijing and
Washington. 
    Retail sales in September rose 2.4 percent from a year
earlier in value terms to HK$36.6 billion ($4.67 billion),
marking their 19th month of expansion, but the slowest growth
since June 2017. That compares with a revised 9.4 percent rise
in August.
    In terms of volume, retail sales grew 1.4 percent in
September, compared with a revised 7.9 percent rise in August.
This marked the slowest growth in retail sales since June last
year.
    Retail sales grew at a slower pace, dented by lean tourism
due to typhoon Mangkhut, while Sino-U.S. trade tensions also
likely weighed, a government spokesman said. 
    "External uncertainties and weaker asset markets may
increasingly affect consumer sentiment," the spokesman said.
"Favourable labour market conditions and buoyant inbound tourism
should continue to support the retail sector in the near term." 
    For the first nine months of 2018, total retail sales rose
11.1 percent in value and 9.6 percent in volume.
    The value of third-quarter retail sales in the city slipped
2.9 percent from the previous quarter, while volume was down 3
percent. 
    China's economy grew less than expected at 6.5 percent in
the third quarter from a year earlier, marking its weakest
expansion since the global financial crisis amid a trade war
with the United States.             
    China's retail sales rose 9.2 percent in September from a
year earlier.             
    The country is planning more tax cuts to help spur domestic
consumption and take more timely steps to support its economy,
which faces increasing pressures.                          
    Analysts are optimistic that tourist arrivals in Hong Kong
from mainland China will remain strong over the long-term as the
Guangzhou-Shenzhen-Hong Kong high-speed railway and Hong
Kong-Zhuhai-Macau Bridge will drive up mainland tourist numbers
and benefit the whole retail market in the city.
    September tourist arrivals rose 1.8 percent from a year
earlier to 4.72 million, according to the Hong Kong Tourism
Board, the slowest growth since January. The count of mainland
visitors grew 3.9 percent, the slowest so far in 2018,
accounting for 78.7 percent of the total. bit.ly/2Dgc5gP
    Sales of jewellery, watches, clocks and valuable gifts
increased 2.2 percent in September, compared with a revised 20.8
percent surge in the previous month, government data showed.
    Growth in medicines and cosmetics rose 4.9 percent from a
revised 16.2 percent in August, while department store sales
were up 2.0 percent compared with a 11.7 percent growth in
August.
    Cosmetic chain Sa Sa International Holdings           saw
slower growth in quarterly sales with average sales per
transaction of local customers rising 2.8 percent, but mainland
tourists down by 2 percent.             
    Sa Sa International said consumer sentiment turned sour due
to a weaker Chinese currency and stock market volatility. 
    Hong Kong-based Chow Tai Fook Jewellery Group           and
smaller rival Luk Fook Holdings (International)           also
posted slower store sales growth in July-Sept period as compared
with the previous quarter.                         

    ($1 = 7.8386 Hong Kong dollars)

 (Reporting by Twinnie Siu and Donny Kwok; Editing by Sherry
Jacob-Phillips)
  
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