Hong Kong Retail Sales Slide as More Analysts Cut GDP Forecasts

(Bloomberg) -- Hong Kong's retail sales grew at a much slower pace than expected, adding to the economy's woes as more analysts downgrade the city's growth outlook.

The value of retail sales rose 6.2% in December from a year earlier, far lower than the median estimate of 12.5% in a Bloomberg survey of economists. Growth in the volume of sales slowed to 3.4%, also well below the median projection of 9%.

For a breakdown of the retail sales data, click here.

The slowdown comes amid an outbreak of the highly contagious omicron virus variant in Hong Kong, which triggered flight bans in December and tighter social distancing restrictions. Goldman Sachs Group Inc. said Friday it's cutting its full-year growth forecast for Hong Kong to 2.4% from 2.6% after last week's weaker-than-expected gross domestic product data. 

“We expect the Hong Kong economy to slow down in the first quarter due to the fifth wave of local Covid outbreak and related control measures,” Goldman's chief China economist Hui Shan and colleagues wrote in a report.

Goldman joins Morgan Stanley, DBS Group Holdings Ltd. and others who have downgraded their forecasts as the omicron outbreak spreads. 

For 2021, retail sales rose 8.1%, rebounding after a major contraction during the pandemic in the previous year.

Read More: Hong Kong's Covid Zero Disintegrates Under Omicron's Onslaught

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