Hong Kong Retail Sales Plunge

RAPAPORT... Sales of jewelry and other luxury items in Hong Kong slid inOctober, marking the second-highest monthly decline on record as protests in the municipality dented consumer sentiment. Revenue from jewelry, watches, clocks and other valuablegifts fell 43% year on year to HKD 3.92 billion ($500.2 million) during themonth, the municipality's Census and Statistics Department reported Monday. . Sales across all retail categories slipped 24% to HKD 30.12 billion($3.85 billion). Demonstrations against an extradition bill have been ongoingsince June, interfering with retail sales and hitting local consumer sentimentand tourism. Although the bill has been scrapped, violence in the municipalityhas continued. "[Total] retail sales continued to plunge in October, andshowed the largest year-on-year decline for a single month on record, as thelocal social incidents...depressed consumption sentiment and severely disruptedtourism and consumption-related activities," a government spokesperson noted. August showed the highest decline for jewelry since the Census and Statistics Department began publishing results in 2005. While January was the only month this year to note an increase, leading to a nine-month consecutive decline, sales during August, September and October each fell more than 40%. The situation has led to a sharp drop in travelers fromChina and abroad, as well as weakened local purchasing. Tourism in Hong Kongwas down 44% to 3.3 million visitors in October, the Hong Kong Tourism Boardreported. Of those, 2.5 million came from mainland China, 46% fewer than thesame period last year. The government expects weakness in the market to continue asconditions persist, stressing that the market would likely not improve untilthe unrest subsided. "Ending the violence in the local social incidents andrestoring social order are crucial to the creation of an environment for theretail business to recover," the spokesperson added, noting the government wouldcontinue to monitor the situation's repercussions on both the municipality'slabor market and the overall economy. In the first 10 months of the year, retail sales ofjewelry, watches, clocks and other valuable gifts decreased 19% to HKD 57.67billion ($7.37 billion). Sales in all retail categories for theJanuary-to-October period fell 9% to HKD 365.12 billion ($46.6 billion). Image: Stores in Kowloon, Hong Kong. (Shutterstock)