Hong Kong's economy recorded a year-on-year increase of 7.2 per cent in the third quarter of 2004, the government said Friday. The increase was lower than the previous quarter - when it leapt by 12.1 per cent - but this was mainly due to the exceptionally low figure of the second quarter the year before during the SARS crisis. Exports of goods and services increased by 15.3 and 10.3 per cent respectively. Government economist Kwok Kwok-chuen said although the external environment was still beset with considerable uncertainties, the distinct easing in oil prices was a welcome development that should ease concerns. "Local consumer spending held firm, as employment conditions improved and sentiment remained generally positive. Private consumption expenditure grew by a solid 5.1 per cent in real terms in the third quarter over a year earlier," he said. In addition, Kwok said the recent weakening of the U.S. dollar had been a positive factor in helping boost Hong Kong's exports. "Furthermore, the weak dollar has helped to drive fund inflows into Hong Kong, leading to lower Hong Kong dollar interest rates," he said. The government is maintaining its GDP forecast for the whole year at 7.5 per cent.
