Hong Kong’s retail sales contracted by 14.6% in February from a year ago, the most significant decline since July 2020, as the government imposed strict restrictions to battle the island city’s worst-ever COVID-19 outbreak.
After 12 straight months of growth, the fall in sales value was even worse than the median decline estimate of 7.7%, as expected by Bloomberg’s economists. Retail sales in February declined 14.6% from the yearearlier to HK$25.3 billion ($3.22 billion), official data released on March 31, 2022, showed. That compares with a revised 4% increase in January 2022 and a 13.7% fall in the last decline in January 2021.
The sales volume fell 17.6% from a year earlier, slightly better than the 19% fall expected by economists. The data released by Hong Kong’s Census and Statistics Department likely does not capture the recent COVID-19 curb’s total impact as it covers consumer spending on goods but not services like catering, entertainment, and medical care, which account for more than 50% of the total consumer spending.
Omicron’s surge in the city and the following restrictions have damaged businesses and threatened growth. According to analysts, a decline in gross domestic product in 2022’s first quarter could be as deep as 4% from a year ago. The city’s business community has also called on the city to give it more say in the government’s COVID-19 strategy.
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