December surge by shoppers boosts yearly retail sales 7.3pc

Year-end growth of 11.5pc well above economists' prediction of 7.8pc for month

Retail sales grew 7.3 per cent in value last year compared to 2005 as spendthrift tourists and Christmas shoppers helped lift December sales by 11.5 per cent to HK$21.5 billion.

Economists had expected growth of only 7.8 per cent in December, a mild increase from the 7.4 per cent in November. The strong sales performance was just shy of the 11.6 per cent growth in January, the best month last year.

Year-on-year growth was 6.8 per cent in 2005.

A government spokesman attributed the year-end sales spurt mainly to rising wages, the general economic recovery, the surge in stock market prices and the arrival of more than 2.4 million visitors, almost 10 per cent up on a year ago.

'Going forward, the favourable macroeconomic environment and the upbeat consumer sentiment should continue to render support to retail business,' the spokesman said.

By volume, total sales last year rose 5.8 per cent, continuing the slide from 6.1 per cent in 2005. Sales growth in 2004 was 9.1 per cent. According to the Census and Statistics Department, the volume of sales for cars increased the most in December, jumping 40.5 per cent. This was followed by electrical goods, up 17.2 per cent, jewellery and watches, a rise of 13.3 per cent, and footwear and clothing accessories, a 12.6 per cent increase.