Hong Kong Retail Sales Jumped in August Thanks to Cash Vouchers
(Bloomberg) -- Hong Kong retail sales surged in August for the biggest increase in four months after the government gave out electronic spending vouchers and spurred local consumption.
The value of retail sales jumped 11.9% in August to HK$28.6 billion ($3.67 billion) for the biggest gain since April, a government report said. The result is well ahead of the median economists’ forecast for a 6.4% advance. Sales by volume also jumped 10.6%, above the median 6.7% estimate.
The Hong Kong government began handing out the first instalments of the vouchers on Aug. 1, and will give a total of HK$5,000 worth of spending vouchers to eligible residents in a bid to support local businesses. Restrictive social distancing measures and border restrictions have devastated Hong Kong’s key tourism, consumption and services industries since the onset of the pandemic.
Alongside the handouts, “the stable local epidemic and improved labor market conditions also contributed,” the government report said. The program, which will make further distributions over the next few months, will “continue to bode well for local consumption sentiment in the rest of the year.”
Hong Kong has slowly emerged from a two-year recession this year amid a rebound in trade and gradual easing of virus control measures. The government raised its 2021 growth forecast to a range of 5.5% to 6.5% in August, with the voucher program seen giving a boost to the economy.
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