Uncertainties in the global economy, including slowing growth in China and a looming interest rate hike in the United States, have weighed heavily on exporter confidence in Hong Kong, the Hong Kong Trade Development Council (HKTDC) said.
The HKTDC export index fell to 37.1 in the third quarter from 46.8 in the previous three months, making it the lowest level since the fourth quarter of 2012, Ming Pao Daily reported on Thursday.
A reading below 50 reflects negative sentiment among exporters.
HKTDC principal economist for global research Daniel Poon said indices for all sectors declined in the third quarter, with the toy industry suffering the biggest slide at 35.6 from 52.5 previously.
The indices for electronics, clothing, jewelry and timepieces all fell below 40.
Exporter sentiment was also negative for the key markets, with indices for the United States, Europe, Japan and China all recording a decrease. The index for the EU was the lowest at 42.8.
The HKTDC also revised down its export growth forecast for this year from 3 percent to zero percent, the lowest since 2012 when it was at minus 1 percent.
Hong Kong exports fell 0.2 percent in the seven months to July from a year ago, data from the Census and Statistics Department showed.
That means that exports for the rest of the year have to grow by at least zero to 1 percent to meet the HKTDC forecast, which is considered quite optimistic, Poon said.
While exports in the fourth quarter might improve because of lower base a year ago, there is a slight chance that exports will register a growth this year, the HKTDC said.
However, director of research Nicholas Kwan said declining exports should be close to bottom now, based on the aggressive attitude of buyers who attended recent exhibitions hosted by the HKTDC.
The imminent rate hike by the Federal Reserve is likely to increase volatility in capital flows and exchange rates in the emerging markets, the major destinations of Hong Kong exports, Kwan said.
As a result, demand for Hong Kong goods might suffer, he added.
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