Hong Kong’s economy registered a robust 3.1% year‑on‑year expansion in the second quarter of 2025, easily surpassing the economists’ consensus forecast of 2.7% and marking the territory’s tenth straight quarter of positive growth.
This pace of expansion edged higher from earlier performance—3.0% in Q1 and 2.5% in the final quarter of 2024—reflecting sustained momentum across multiple economic drivers. Quarter‑on‑quarter, seasonally adjusted GDP rose by only 0.4% in Q2, down from a sharper 1.8% in Q1, indicating some slowing of growth acceleration.
Exports of goods delivered a standout performance, climbing 11.5% year‑on‑year, up from 8.4% in Q1. This surge was fueled in part by temporary easing of U.S. tariffs, prompting what officials described as “rush shipments” ahead of anticipated duties. Goods imports similarly surged, rising by 12.7%, compared with 7.2% in Q1, underlining robust external demand pressures.
Service exports—driven by inbound tourism recovery and greater cross‑boundary traffic—also offered meaningful support to growth. Meanwhile, investment expenditure expanded alongside the broader economic upswing.
On the domestic front, private consumption bounced back modestly, rising 1.9% in Q2. That marks a notable recovery from declines of 1.2% in Q1 and 0.2% in Q4 of 2024, as market stability and policy incentives helped restore household spending confidence.
Looking ahead, the Hong Kong government remains cautiously optimistic about future prospects. It anticipates that steady economic growth across Asia, particularly in mainland China, along with proactive domestic policies—from boosting consumption sentiment to diversifying markets—will remain key anchors of momentum. However, officials also flagged concerns over potential reimposition of U.S. trade tariffs, which could undermine investment sentiment—and cautioned that the current frontloading (“rush shipment”) effect may fade later in 2025.
While the headline GDP beat expectations, underlying trends reflect a mixed outlook: export strength and investment gains are delivering growth, but household spending and external policy uncertainty remain risks. That nuanced performance lends credence to the government’s maintained full‑year GDP growth forecast of 2%–3%, as laid out in its May economic report.
Overall, Hong Kong’s latest GDP figures reinforce a narrative of steady recovery with external tailwinds, yet underscore the vulnerability to shifts in global trade dynamics and consumer confidence heading into the second half of 2025.
