(Bloomberg) -- Business conditions in Hong Kong showed further signs of stabilization in June, as the government further eased social-distancing restrictions with coronavirus infection rates largely under control.
The IHS Markit purchasing managers' index for Hong Kong climbed to 49.6 in June, the highest since March 2018 when the reading was last above the 50 level that marks expansion. The results show businesses in the city were more willing to invest in new capacity than in previous months, yet with sentiment still negative amid concerns about the long-term economic impact of the pandemic.
The survey was conducted from June 12 to 25, ahead of the implementation of the national security law imposed by China on Hong Kong.
“The potential of a robust recovery in the Hong Kong economy relies on the strength of the upturn in the global economy in the coming months,” Bernard Aw, principal economist with Markit, said in the report.
Anecdotal evidence suggests the easing of social distancing measures, including lifting some restrictions on public gatherings, contributed to increased business activity in some industries especially in restaurants, bars and hotels, the report said.
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