Hong Kong's business activity contracts further in July amid resurgence of COVID-19 infections: survey
A private survey showed on Wednesday that the business activity contracted further in China's Hong Kong Special Administrative Region as the worsening COVID-19 epidemic weighed on business confidence.
The Purchasing Managers' Index of Hong Kong compiled by consulting firm IHS Markit dropped to 44.5 last month from 49.6 in June.
A PMI greater than 50 indicates expanding business activity, while a figure lower than 50 indicates the contraction.
Having moved close to stabilization in June, Hong Kong's business conditions worsened sharply at the start of the third quarter amid a tightening of containment measures due to a resurgence of new COVID-19 infections, IHS Markit said in a report.
The report showed that new orders declined at a steeper rate during July and firms, in turn, scaled back their purchasing activity substantially, resulting in a sharp fall in inventories. Business confidence deteriorated further, with rising concerns over the adverse impact of a new wave of COVID-19 cases on the economy.
Hong Kong's economy slumped 9 percent year on year in the second quarter of this year, only improving slightly from a record-high 9.1-percent drop in the first quarter.
Given a sluggish economy, the HKSAR government has rolled out unprecedented relief measures worth nearly 290 billion Hong Kong dollars (US$37.4 billion) to help safeguard jobs, support enterprises and relieve people's financial burdens.
Hong Kong's Center for Health Protection reported 80 new confirmed cases of COVID-19 on Tuesday, taking the total tally to 3,669.
The government has intensified social distancing measures, expanded testing capacity, added quarantine facilities, and sought assistance from the central government to contain the epidemic.