Retail sales of jewelry and other luxury items in Hong Kong declined for the first time in 17 months as global economic uncertainties impacted consumer sentiment.
Revenues from jewelry, watches, clocks and other valuable gifts dropped 3.9% to HKD 5.88 billion ($750.8 million) in November, the municipality’s Census and Statistics Department reported Thursday. Sales in all retail categories increased 1.4%, but growth was the slowest in more than 12 months.
“The generally moderated growth in retail sales in recent months reflected more cautious consumption sentiment in the face of various external uncertainties such as the US-mainland trade tensions, and volatilities in the global financial markets,” a government spokesperson said.
Hong Kong-based jewelers Chow Tai Fook and Luk Fook raised concerns in November about the impact of the US-China tariff war and the depreciation of the Chinese yuan on the region’s consumer demand. While proceeds from jewelry and other luxury products jumped 16% to HKD 77.06 billion ($9.84 billion) for the first 11 months of 2018, growth slowed in September and October, according to government figures. The November decline matches Luk Fook’s warning that its same-store sales had dropped in late October and November.
Retail sentiment could suffer further due to a drop in the value of assets consumers own, as well as uncertainty in the global economy, the government added. A positive job market and growth in Hong Kong’s tourist industry — a major source of retail spending in the municipality — should partly support the sector, the spokesperson continued.
Monthly sales of jewelry and other luxury products in the municipality last fell in June 2017, when the market was recovering from a slump in tourism in 2015 and 2016.