Hong Kong PMI falls to lowest since 2008 in continuing plunge

Author: Adam Button | Category: News

Twenty-two weeks of protests haven't exactly helped

Twenty-two weeks of protests haven't exactly helped

Hong Kong isn't exactly a barometer of anything in the global economy but it certainly demonstrates the fallout of civil disorder.

It's a prosperous, modern place and yet it's been gripped by 22 weeks of protests.

It's easy to dismiss as a unique situation with the proximity to China but it's not the only place where people are angry. There have been massive recent demonstrations in Lebanon, Chile and Iraq.

This index from Markit is for the entire economy (not services or manufacturing like its other services) and was just released. The output index fell to 32.3 from 36.8 and that's the lowest since the series began.

Bloomberg notes that more than 2500 corporate executives mentioned Hong Kong in earnings call transcripts. Tourism has been dashed by turmoil. GDP was down 2.9% y/y in last week's Q3 advance report.

Retail sales were down 18% in September and hotel occupancy rates were 23 percentage points below the same period a year ago.

So far, there are no visible signs of strain in the USD/HKD peg. Last week Hong Kong Monetary Authority head Eddie Yue said deposit levels were steady and that there has been no significant capital outflow. That's hard to believe

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