Hong Kong third-quarter GDP expands by 5.2% year-on-year

Hong Kong's economy demonstrated robust growth for a record 15th consecutive quarter in the third financial quarter, with GDP expanding by 5.2% year-on-year. Retail sales also rose notably in September, recording a 6.4% increase. The Census and Statistics Department's advance estimates revealed that GDP growth had increased from 4.2% in the second quarter to 5.9% in the first quarter.

Over the first three quarters, the economy expanded by 5.1%, marking the quickest growth in this period in five years. On a seasonally adjusted basis, GDP rose by 1.9% from the previous quarter.

Government spokesman attributed the robust expansion to accelerating exports and solid domestic demand. Goods exports surged 30.4% year-on-year in real terms, while service exports grew by 4.3%. Private consumption expenditure increased by 2.8%, a slight decline from 2.9% in the second quarter, while overall investment expenditure rose by 7.3%. The economy's performance in the first three quarters combined was 5.1%, the fastest growth in five years.

Financial Secretary Paul Chan Mo-po had earlier predicted that Hong Kong could achieve its strongest annual economic growth in five years, raising expectations of a further upgrade to the government's forecast. Authorities had previously raised their full-year growth forecast to between 3.5 and 4.5% from between 2.5 and 3.5% following a stronger-than-expected first half. The revised full-year forecast is due on November 13.

Exports remained strong in the third quarter, with September shipments increasing by 64.9% year-on-year to HK$762.6 billion, the fastest monthly growth in over four decades. This growth was driven by demand for artificial intelligence-related products. September also saw retail sales total HK$33.4 billion, marking an 8.3% increase from a year earlier, following growth of 5.6% in August and 4.5% in July.

The growth was broad-based across various retail outlets, with jewellery, watches, and clocks experiencing the fastest growth at 20.3%, followed by optical shops at 14.6%. Motor vehicles and parts, however, faced the steepest decline of 34.7%, while department store sales fell by 4.1%. The Hong Kong Retail Management Association reported that 75% of its survey respondents indicated year-on-year sales growth in September, despite cautioning that uneven performance across categories suggests the sector has yet to fully recover. The association maintains its forecast for single-digit sales growth this year.