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Modest growth

Modest growth:  Government Economist Helen Chan announces the economic situation for the first quarter of 2013.

HK economy grows 2.8%

May 10, 2013
Hong Kong's economy grew 2.8% in real terms year-on-year in the first quarter. On a seasonally adjusted quarter-to-quarter comparison, real GDP expanded by 0.2%.
Announcing the figures today, Government Economist Helen Chan said the modest growth was mainly backed by a relatively resilient domestic sector, while the external sector is still facing an unsteady global economic environment.
Declines were recorded in exports to advanced markets like the US, Europe and Japan, but solid growth in both the Mainland and some other Asian markets resulted in exports of goods rising by 8.8% in real terms.
She said the strong growth was also largely due to a surge in exports of non-monetary gold.

Exports of services saw 4.9% year-on-year growth, under the support of vibrant inbound tourism and improved financial market activity.
Domestically, private consumption expenditure grew 7.0% in real terms over a year earlier, on the back of broadly supportive labour market conditions, with a relatively low seasonally adjusted unemployment rate of 3.5% for the quarter.
Underlying consumer price inflation held stable at 3.8%, having eased successively last year.
Residential property prices fell slightly 0.1% in March, reversing the exuberant situation in the first two months of 2013 when flat prices on average rose 2.6% per month.
Mrs Chan said as recent developments in the global economic environment have been largely consistent with the picture envisaged earlier this year, and Hong Kong’s economic growth in the first quarter also accords with expectations, the GDP growth forecast of 1.5% to 3.5% for 2013 as announced in the Budget has been maintained.
She forecast that, with the lagged effects of the surge in private housing rents over the past year progressively feeding through, inflation will likely to rise back slightly in the coming months.
Likewise, the forecast rates of headline and underlying consumer price inflation for 2013 put out in the Budget, at 4.5% and 4.2% respectively, are also being maintained for the time being, she added.
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The 2013-14 Budget