Pace of Hong Kong’s economic recovery may need to be re-evaluated but no drastic changes to forecasts, finance chief Paul Chan says

Hong Kong’s finance chief has warned of a need to re-evaluate the pace of economic recovery in the city amid possible delays to US interest rate cuts, but added that there will not be any drastic adjustments to growth forecasts.

Financial Secretary Paul Chan Mo-po said on Saturday that Hong Kong might face a higher interest rate environment for longer as the US Federal Reserve had earlier indicated any cuts might take longer than previously anticipated following a series of surprisingly high inflation readings.

“In that case, interest rate cuts in the city may need to be pushed back. We may need to re-evaluate the pace of economic growth,” Chan said at a Hong Kong News-Expo event.

But Chan maintained his economic growth forecast of between 2.5 per cent and 3.5 per cent for the full year, the same range as for the first quarter.

He also said there would not be any drastic adjustments to the forecast following stronger than expected exports.

“We’ve envisaged a gradually rising trend with the second half of the year faring better than the first half,” he said.