2022.05.0313:37:00UTC+00Hong Kong Economy Contracts In Q1

Hong Kong's economy contracted in the first quarter due to weak domestic and foreign demand, advance estimates from the Census and Statistics Department showed on Tuesday.

Gross domestic product shrank 4.0 percent year-on-year in the first quarter, in contrast to the 4.7 percent expansion seen in the fourth quarter. GDP was forecast to fall 1.0 percent.

On the expenditure-side, private spending decreased 5.4 percent, while government consumption grew 5.9 percent. Gross domestic fixed capital formation was down 8.3 percent.

Exports and imports of goods decreased 4.5 percent and 5.9 percent, respectively and exports and imports of services fell 2.8 percent each.

On a seasonally adjusted quarter-to-quarter basis, real GDP fell 2.9 percent in the first quarter, having shown little change in the preceding quarter.

Although there are signs that activity is rebounding, the recovery is expected to prove weak, economists at Capital Economics, said. The firm observed that although virus containment measures are being eased, rising interest rates, softer global trade and an absence of mainland visitors will hold back the city's economic recovery in the coming months.