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Hong Kong Sept retail sales grow at slowest pace in 15 months

* Sept retail sales value up 2.4 pct y/y, volume up 1.4 pct

y/y

* Jan-Sept retail sales value up 11.1 pct y/y, Q3 down 2.9

pct q/q

* Sept tourist arrivals rise 1.8 pct y/y, Jan-Sept up 9.5

pct

* External uncertainty, weak asset markets may hit

sentiment- govt

By Donny Kwok

HONG KONG, Nov 1 (Reuters) - Hong Kong's retail sales in

September grew at their slowest pace in 15 months, government

data showed on Thursday, with outlook clouded by external

headwinds including mounting trade friction between Beijing and

Washington.

Retail sales in September rose 2.4 percent from a year

earlier in value terms to HK$36.6 billion ($4.67 billion),

marking their 19th month of expansion, but the slowest growth

since June 2017. That compares with a revised 9.4 percent rise

in August.

In terms of volume, retail sales grew 1.4 percent in

September, compared with a revised 7.9 percent rise in August.

This marked the slowest growth in retail sales since June last

year.

Retail sales grew at a slower pace, dented by lean tourism

due to typhoon Mangkhut, while Sino-U.S. trade tensions also

likely weighed, a government spokesman said.

"External uncertainties and weaker asset markets may

increasingly affect consumer sentiment," the spokesman said.

"Favourable labour market conditions and buoyant inbound tourism

should continue to support the retail sector in the near term."

For the first nine months of 2018, total retail sales rose

11.1 percent in value and 9.6 percent in volume.

The value of third-quarter retail sales in the city slipped

2.9 percent from the previous quarter, while volume was down 3

percent.

China's economy grew less than expected at 6.5 percent in

the third quarter from a year earlier, marking its weakest

expansion since the global financial crisis amid a trade war

with the United States.


China's retail sales rose 9.2 percent in September from a

year earlier.


The country is planning more tax cuts to help spur domestic

consumption and take more timely steps to support its economy,

which faces increasing pressures.


Analysts are optimistic that tourist arrivals in Hong Kong

from mainland China will remain strong over the long-term as the

Guangzhou-Shenzhen-Hong Kong high-speed railway and Hong

Kong-Zhuhai-Macau Bridge will drive up mainland tourist numbers

and benefit the whole retail market in the city.

September tourist arrivals rose 1.8 percent from a year

earlier to 4.72 million, according to the Hong Kong Tourism

Board, the slowest growth since January. The count of mainland

visitors grew 3.9 percent, the slowest so far in 2018,

accounting for 78.7 percent of the total. https://bit.ly/2Dgc5gP

Sales of jewellery, watches, clocks and valuable gifts

increased 2.2 percent in September, compared with a revised 20.8

percent surge in the previous month, government data showed.

Growth in medicines and cosmetics rose 4.9 percent from a

revised 16.2 percent in August, while department store sales

were up 2.0 percent compared with a 11.7 percent growth in

August.

Cosmetic chain Sa Sa International Holdings saw

slower growth in quarterly sales with average sales per

transaction of local customers rising 2.8 percent, but mainland

tourists down by 2 percent.


Sa Sa International said consumer sentiment turned sour due

to a weaker Chinese currency and stock market volatility.

Hong Kong-based Chow Tai Fook Jewellery Group and

smaller rival Luk Fook Holdings (International) also

posted slower store sales growth in July-Sept period as compared

with the previous quarter.


($1 = 7.8386 Hong Kong dollars)

(Reporting by Twinnie Siu and Donny Kwok; Editing by Sherry

Jacob-Phillips)