Hong Kong economy records surprise 2.8 per cent growth

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The economy grew faster between April and June despite volatile economic environments outside Hong Kong. Photo: EPA

Published: 2:45am, 15 Aug 2015Updated: 8:22pm, 17 Aug 2015

Hong Kong's economy fared better in the second quarter of this year, with growth at a stronger-than-expected 2.8 per cent, prompting the government to lift its target for full-year growth.

The economy grew faster between April and June, which the government attributed to buoyant demand within the city. This is despite the fact that the economic environment outside Hong Kong was relatively hostile, it added.

For the full year, the government expected growth to range from two to three per cent - up from an earlier target of between one and three per cent.

ANZ Research said second-quarter growth beat analysts' consensus of a 2.3 per cent rise. Growth was 2.4 per cent in the first quarter.

Research by Hang Seng Bank showed that private consumption jumped 6 per cent in the second quarter, the highest rate since the first quarter of 2013 - and up from 5.3 per cent in the previous quarter, which underlined the positive impact of asset price appreciation and the expansion of the government relief package introduced in this year's budget.

Still, some analysts say Hong Kong faces a cocktail of challenges ahead - a strengthening local currency, a weaker yuan, an economic downturn on the mainland and the ripple effect of a looming US interest rate rise.