Q2 GDP up 1.8% (15.8.2014)

Hong Kong’s economy expanded moderately in the second quarter, with real GDP rising by 1.8% year-on-year, marking the slowest growth since the third quarter of 2012, Government Economist Helen Chan said today. On a seasonally adjusted quarter-on-quarter comparison, real GDP dipped by 0.1% in the second quarter, compared to 0.9% growth in the preceding quarter. Underlying consumer price inflation eased further to 3.5% from 3.8% in the previous quarter. Headline inflation slowed to 3.6% from 4.2%. Delivering the Half-yearly Economic Report, Mrs Chan said that due to the worse-than-expected outturn in the first half of the year, the GDP growth forecast for this year has been revised downward to 2-3% from 3-4% in the May review. The headline and underlying consumer price inflation forecasts for this year are also revised downward to 4.4% and 3.5% from 4.6% and 3.7%. Services exports declined 2.3% year-on-year in real terms, marking the first decline since the second quarter of 2009, as travel services exports recorded a double-digit plunge. Mrs Chan said the labour market held stable, with the unemployment rate edging up to 3.2% from 3.1%, a 16-year low. She said the second quarter’s weak economic performance is due to tourist spending fall-off and domestic demand slowdown. As the US interest rate hike lessened, local residential property prices and rent rose last quarter, she added. (http://j.mp/1uBmvfz)