Hong Kong narrowly escaped a recession, with its economy growing 0.1 per cent in the third quarter from the previous three months.
Low unemployment and continued growth in visitors from the mainland meant consumption held up, but the euro-zone debt crisis dragged exports down.
Compared with a year ago, the economy grew 4.3 per cent year on year, down from a revised 5.3 per cent in the second quarter.
The government warned that global economic uncertainty could worsen in the near term and that growth could remain subdued. Meanwhile, inflation is expected to peak in the fourth quarter, with rents and food prices stabilising.
'The macro risk ahead of us has shifted from inflation to the growth outlook,' Government Economist Helen Chan told a news conference.
Output between April and June contracted by 0.4 per cent from the first quarter, and a further contraction from July to September would have sent Hong Kong into recession. (A technical recession occurs when quarter-on-quarter growth contracts for six months.)
Chief Executive Donald Tsang Yam-kuen said this week that Hong Kong would not be exempt from a global crisis and that there could be a few quarters of 'bad times', although a full-year recession was unlikely.
