Talking Points
- Hong Kong’s economy grew by 0.7% quarter/quarter in Q1, beating the median forecast of analysts.
- It grew by 4.3% year/year, also above expectations.
- Check out the DailyFX Economic Calendar and see what live coverage of key event risk impacting FX markets is scheduled for the week on the DailyFX Webinar Calendar.
Hong Kong’s economy grew faster than expected in the first three months of 2017, with GDP expanding by 0.7% quarter/quarter, above the median forecast of 0.5% in a poll of analysts. Year/year GDP growth was 4.3%, also beating expectations of 3.4% growth.
While the latest quarterly expansion rate was down from the previous 1.2%, growth on the year rose from the prior 3.1% and remains well above the government’s projected range of 2%-3% for 2017. In response, the Hong Kong Dollar was little changed, with USD/HKD trading at 7.7924, compared with 7.7925 just ahead of the release.
The HKD has been of the weakest currencies so far this year, with USD/HKD on an upward trend that so far shows no sign of ending.
Chart: USD/HKD Daily Timeframe (January 1, 2017 to May 12, 2017)
Source: Investing.com
The pickup in GDP growth reflects a strong domestic housing market, an improvement in exports as global trade remains buoyant and firm overseas demand from China, which often imports goods through Hong Kong’s ports.
--- Written by Martin Essex, Analyst and Editor
To contact Martin, email him at martin.essex@ig.com
Follow Martin on Twitter @MartinSEssex
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