Hong Kong: Growth outlook improves – UOB

UOB economist Ho Woei Chen reports that Hong Kong's GDP growth accelerated in the third quarter of 2026, driven by robust exports and investment. The semiconductors and AI supply chain sectors, a stabilising property market, and rising tourist arrivals contributed to the growth. UOB has revised its Hong Kong GDP forecasts upward for 2026 and 2027, while acknowledging external and financial risks.

Hong Kong's GDP growth surged to 5.2% in Q3 2026 from a revised 4.2% in Q2 2026, with a seasonally adjusted quarter-over-quarter growth of 1.9%, following a contraction of 0.7% in the previous quarter. Goods exports increased by 30.4% year-over-year, and gross domestic fixed capital formation rose by 7.3% year-over-year. Private consumption growth remained steady at 2.8% year-over-year, while government consumption improved by 1.7% year-over-year.

The semiconductors trade and Hong Kong's role in the global AI supply chain continued to bolster the city's economic growth. Despite uncertainties in the Middle East, rising interest rates, and tighter mainland scrutiny over capital outflows, consumer sentiment softened and retail sales growth moderated. However, the stabilising property market and improving tourist arrivals provided support.

UOB has revised its GDP growth forecasts higher, predicting 5.0% growth for 2026 and 3.0% growth for 2027.