Hong Kong’s economy expected to improve in Year of the Dragon owing to ‘favourable’ market conditions, Paul Chan says

External interest rates have peaked, but expectations of pace of decrease differ, city’s finance chief says

Chan also highlights coming domestic national security law, says ‘stable’ environment is indispensable for economic growth

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Finance chief Paul Chan (right) attends an opening ceremony for a Lunar New Year night market. Photo: Dickson Lee

Published: 5:31pm, 4 Feb 2024Updated: 10:04pm, 4 Feb 2024

Hong Kong’s economy is expected to improve in the Year of the Dragon, owing to an anticipated decline in external interest rates following a peak and “favourable” market conditions, the city’s finance chief has said.

Financial Secretary Paul Chan Mo-po on Sunday also highlighted the start of the one-month public consultation on the city’s domestic national security law, saying that maintaining stability was a prerequisite for economic development.

“With the new year and new atmosphere, we believe that the overall market situation in the Year of the Dragon is expected to be stable and improve,” Chan said.

“There is market consensus that external interest rates have peaked. While expectations on the pace of decrease differ, the trend is beneficial to alleviate pressure on the asset market.”

Paul Chan (second from left) at a Lunar New Year night market last week. The finance chief has expressed an optimistic outlook for the city’s economy for the Year of the Dragon. Photo: Dickson Lee

Chan added that the “moderate” inflation rate, a sub-3 per cent unemployment rate and economic growth in mainland China had created a “favourable environment for us to stabilise market expectations”.