Hong Kong Retail Sales (April 2017)

After a strong performance in March, retail sales came in weaker than the marketand our expectations. Sales values rose by muted 0.1% y-o-y in April comparedwith 3.0% y-o-y in March. In volume terms, retail sales also came in weaker at-0.1% y-o-y. We believe this month’s data are distorted by two negative factorswhich are deemed as temporary, the timing of Easter and changes to the taxincentive scheme for electric cars which became effective in April. In all, wecontinue to expect further stabilisation in the retail sector, supported by strongerlocal demand and a modest revival in inbound tourism.