The Census and Statistics Department (C&SD) released the latest figures on retail sales March 3.
The value of total retail sales in January 2008, provisionally estimated at $25.7 billion, increased by 23.3% over a year earlier. After netting out the effect of price changes over the same period, the volume of total retail sales increased by 17.4% in January 2008 over a year earlier.
Affected by the timing of the Lunar New Year, with local consumer spending normally at a seasonal high just before the Festival, retail sales tend to show greater volatility in the first two months of a year. As the Lunar New Year fell in early February this year but in mid-February last year, more significant year-on-year increases in retail sales in some of the outlet types were observed in January this year.
The revised estimate of the value of total retail sales in December 2007, at $25.1 billion, increased by 16.9% over December 2006, while the volume of total retail sales increased by 12.5%.
Analysed by type of retail outlet and comparing January 2008 with January 2007, the volume of sales of footwear, allied products and other clothing accessories increased the most, by 35.6%. This was followed by sales of miscellaneous consumer goods (+21.6%); commodities in department stores (+19.6%); furniture and fixtures (+19.3%); wearing apparel (+18.5%); jewellery, watches and clocks, and valuable gifts (+11.6%); commodities in supermarkets (+10.4%) and miscellaneous consumer durable goods (+3.8%).
Based on the seasonally adjusted series, the volume of total retail sales increased by 1.5% in the three months ending January 2008 compared with the preceding three-month period.
These retail sales statistics are primarily intended to measure the sales receipts in respect of goods sold by local retail establishments, for gauging the short-term business performance of the local retail sector. They cover consumer spending on goods but not on services.
Moreover, they include spending on goods by visitors in Hong Kong but not by Hong Kong residents outside Hong Kong. Hence they should not be regarded as a comprehensive indicator of overall consumer spending. In this context, it may be noted that the share of consumer spending on services in overall consumer spending has been increasing over time.
Users interested in the trend of overall consumer spending should refer to the quarterly series of private consumption expenditure (PCE), which is a major component of the Gross Domestic Product. Compiled from a wide range of data sources, PCE covers consumer spending on both goods (including goods purchased from all channels) and services by Hong Kong residents whether domestically or abroad.
Commentary:
A Government spokesman pointed out that total retail sales remained strong in January 2008, recording the eighth consecutive month of double-digit year-on-year growth in volume terms.
The remarkable performance was broad-basedspreading across major types of retail outlets. Yet caution should be exercised when reading the figures for January, as retail sales tend to show greater volatility in the first two months of a year due to the timing of the Lunar New Year.
Looking ahead, the strength in consumer demand, on the back of strong economic fundamentals and rising labour income, together with the robust inbound tourism, should be favourable to the further expansion of retail business.
