More Downside Risks To Growth In HK

Economic Research	29 June 2016
Hong Kong
Economic Outlook
More Downside Risks To Growth In HK HK's economic growth recorded a 4-year low in 1Q16, given slowdown in external trade and private spending. Looking ahead, we believe HK’s economy will continuously suffer from deteriorating global economic conditions, fewer tourist arrivals, rising volatilities in financial markets and potential rise in unemployment in 2H16 and 2017. Strengthening HKD will be another overhang for recovery of retail business and tourism industries. In the meantime, we expect property market to stay stable in the near term given delayed interest rate hike in the US, but the risk is still on the downside if the Fed decides to tighten its monetary policy in late 2H16 or 2017. Overall, we believe HK’s GDP growth will moderate to 1.4% in 2016, vs our previous projection of 1.7% and from 2.4% in 2015. Economist:  Zhang Fan| +8621 6288 9611 ext 105
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