Deloitte: Benefiting from stable real estate market and booming stock market, retail sales in Hong Kong are expected to increase by nearly 8% to HKD 410 billion this year.

Last year, the temporary estimate of the total sales value of the retail industry in Hong Kong increased by 1% year-on-year to 380.5 billion yuan. Deloitte expects that in 2026, Hong Kong's retail sales will increase by nearly 8% year-on-year to about 410 billion Hong Kong dollars, mainly due to the gradual recovery of the Chinese economy. Although geopolitical risks still exist, the stabilization of the real estate market and the strong stock market, coupled with the wealth effect brought by the strong Renminbi driving an increase in visitors to Hong Kong, make the market outlook more optimistic. Last year, the increase in outbound tourism by Hong Kong people led to some consumption flowing to the mainland and overseas markets, but it is expected that the strengthening of the Renminbi at the end of the year will weaken the consumption power of Northbound consumers. Deloitte China predicts that this year, visitors to Hong Kong will continue to drive consumption in luxury goods, electronics, pharmaceuticals, cosmetics, and food and beverage sectors, but outbound consumption may offset some retail growth. Deloitte China's Hong Kong consumer market business partner, Zheng Huanran, stated that the Hong Kong consumer market saw an ideal recovery in the second half of last year, and it is expected that the local retail industry in Hong Kong will maintain momentum this year. The main retail categories are expected to drive growth, with jewelry, watches, and luxury gifts expected to increase by 19%, clothing and footwear by 16%, pharmaceuticals, and cosmetics by 11%, and department stores by 10%. Due to the general lag of the stock market about six months behind macroeconomic impacts, the performance in the second half of the year is expected to be better than the first half, similar to last year. Hong Kong hosted several large and exciting events last year. Deloitte China recommends that the Hong Kong government further deepen and expand the event-driven economic development, increase support for hosting major sports events, concerts, exhibitions, and international conferences to attract more tourists and extend their stay in Hong Kong. Additionally, by utilizing Kai Tak Sports Park and Kai Tak Cruise Terminal to host more flagship events, Hong Kong can further enhance its international image and solidify its position as a tourism hub and conference capital.