Still too early to confirm Hong Kong's export recovery

Hong Kong will announce its April external trade numbers on 28 May. Standard Chartered expects export growth to come in at 4.5% y/y, up from -1.8% prior, mainly on a favourable base effect. With China's trade data over the same period still weak and its economy yet to stabilise, analysts see a risk of Hong Kong export growth staying soft through Q2-2015 at least, rather than confirming the start of a more sustained recovery. 

Analysts believe signs of a recovery will only present in Q3 at the earliest, when US growth reaccelerates and China bottoms out. Hong Kong's April import growth is likely to come in at 0.5% y/y, reflecting recent weak retail sentiment due to the structural shift in mainland tourist spending and elevated social tensions between the countries, added Standard Chartered.