Hong Kong set to enjoy economic tailwinds in the 2nd half, but beware of housing risks, BOCHK says
BOC Hong Kong Holdings says an improving global outlook and low interest rates add up to good economic news for Hong Kong during the second half, but warns of risks from inflated housing market
Hong Kong should enjoy economic tail winds in the second half, thanks to an improving global outlook, although extremes in the housing market raise the possibility of unforeseen shocks, according to BOC (Hong Kong) Holdings.
Hong Kong’s GDP growth will likely pick up to 2.8 per cent this year, near the upper end of the government’s forecast range, said BOCHK, the Hong Kong-listed arm of Bank of China and one of the city’s largest lenders.
In a presentation on Tuesday the banks said an improved global outlook will help boost trade activity while ultra-low interest rates will continue to support the housing market and other asset prices.
Last year, Hong Kong’s economy grew 2 per cent, thanks in part to a pickup from the second half.
The upturn in activity will also spill over into the city’s benchmark Hang Seng Index, which will likely gather momentum to close in on the 27,000-point level, the bank said.
Earlier this month, the Hong Kong government maintained its previous GDP growth forecast of 2 per cent to 3 per cent for 2017.