A spending survey done by MasterCard shows that March retail sales in Hong Kong declined at the worst rate in the history of the survey. According to the latest MasterCard SpendingPulse Hong Kong Report, "Overall retail sales in Hong Kong contracted 18.5% year-on-year, reflecting the deepest decline since 2014."
Only grocery outperformed overall retail sales in March, while clothing and jewellery sales dropped by more than total retail sales. After the dismal March, Q1 retail sales declined 11.7% when compared to the same period in 2015. "The early Easter holiday did nothing to stimulate spending as consumer confidence remains subdued." said Sarah Quinlan, Senior VP of market insights for MasterCard advisors. "Overall our outlook for Hong Kong retail sales remains weak as the slowdown in spending from Mainland China continues to negatively impact the Hong Kong retail economy." Quinlan added.
A slowdown in tourist spending from Mainland China is certainly no surprise, as it was only a matter of time before the massive amount of job losses made its way through the economy, something which should get worse in the future as China addresses the economic slowdown and its massive overcapacity issue.