Hong Kong’s economy grew by 2.7% in the first quarter of 2024, exceeding market expectations of 0.8% growth but slower than the 4.3% seen in the previous quarter, according to the Census and Statistics Department. This growth was driven by a surge in tourism, service exports, and improved goods exports, although it was partly due to a low comparative base from the previous year. Despite this uptick, household spending showed modest growth of only 1%, reflecting continued weak consumer sentiment. Service exports, including tourism, grew by 8.1%, a decline from the 21.2% increase in the last quarter of 2023. Morgan Stanley has revised its forecast for Hong Kong’s retail sales to a 5% decline from a previously anticipated increase, citing high-interest rates and economic challenges.