Hong Kong's retail sector experienced a downturn in August, with a notable decline in luxury goods sales as consumers shifted their spending and opted for overseas travel during the summer. According to data released by the Census and Statistics Department, sales of jewelry, watches, clocks, and high-value gifts fell by 24% year-on-year, amounting to HKD 3.93 billion ($505.8 million). Across all retail categories, sales decreased by 10%, totaling HKD 29.18 billion ($3.75 billion), reflecting a similar drop in July, where luxury sales declined by 25%.
A government representative attributed the drop in retail performance to changing consumer behavior, a strong Hong Kong dollar, and the increase in international travel during the summer. Additionally, the decline was partly due to a higher comparison base from the same period last year when the reopening of the China-Hong Kong border led to a tourism surge, which had boosted luxury sales.
From January to August, luxury sales in the city fell by 16%, reaching HKD 34.18 billion ($4.4 billion), while overall retail sales across all categories dropped by 8%, standing at HKD 249.81 billion ($32.13 billion).
Looking forward, the spokesperson indicated that the retail sector might continue to face short-term challenges. However, government initiatives aimed at revitalizing market sentiment, along with economic growth, improved employment rates, rising incomes, and a favorable exchange rate for the Hong Kong dollar, could help stabilize the retail environment.