17 March 2014
Export Confidence on the Rebound
The HKTDC Export Index is designed to monitor the current export performance of Hong Kong traders and gauge their near-term prospects.
The HKTDC Export Index, rebounded to 48.1 in the first quarter of 2014 (1Q14), from 38.5 in 4Q13, reflecting improving export confidence. However, a reading below 50 indicates a pessimistic sentiment and signals a quarter-on-quarter contraction of Hong Kong’s exports.
All major industries showed higher export confidence in 1Q14. In particular, the index for machinery increased to 52.1 in 1Q14, signalling an optimistic sentiment. By contrast, timepieces, toys and clothing recorded the lowest readings of 43.6, 44.1 and 44.8, respectively.
Export sentiment also improved across all major markets. In particular, the indices for Japan and the Chinese mainland both increased to 51.1 in 1Q14, back into expansionary territory. The indices for the US and the EU also rose, registering 48.9 and 48.1 respectively.
The Offshore Trade Index increased only slightly to 41 in 1Q14, from 40 in 4Q13. Offshore trade (shipments not passing through Hong Kong, but handled by Hong Kong traders) is likely to shrink on a quarter-on-quarter basis and underperform Hong Kong’s overall exports.
The Trade Value Index edged up to 56.2 in 1Q14, hinting at higher unit prices in general in the near term. Among major industries, toys and timepieces saw the highest readings of over 60. Clothing exporters, with the index at 50, are neutral with regard to a change in unit prices in the near term.
The Procurement Index has trended downwards, registering 51.8 in 1Q14 yet staying in expansionary territory. Among the major industries, toys and timepieces saw the highest readings. The improved procurement sentiment in the quarter may reflect higher prices for raw materials/semi-manufactures or an optimistic outlook over the longer term.
The Employment Index increased to 48.9 in 1Q14, from 43.4 in 4Q13. With its reading above 50, jewellery is the only industry that expects labour expansion over the short term. By contrast, clothing, timepieces and toys had the lowest readings in 1Q14, signalling labour contraction.