Hong Kong Q2 GDP Grows 4.3% Year-on-Year, 2026 Forecast Raised

Hong Kong's economy grew 4.3% year-on-year in the second quarter of 2026, according to official data released on Friday. The expansion was supported by strong external trade and resilient domestic demand, although it marked a slowdown from the 5.9% growth recorded in the first quarter.

On a seasonally adjusted quarter-to-quarter basis, real GDP contracted by 0.6% in the April-June period. Despite the sequential dip, the first half of 2026 saw overall growth of 5.1% compared to the same period last year — the strongest half-yearly performance in nearly five years.

In response to the data, the government raised its full-year GDP forecast for 2026 to a range of 3.5% to 4.5%, up from the previous estimate of 2.5% to 3.5%.

Government economist Irina Fan said the economy should see solid growth in the second half of the year. She pointed to sustained global demand for AI-related electronic products as a key support for Hong Kong's merchandise trade, while also flagging the need to monitor risks tied to the rapid expansion of global AI investment.

Service exports are expected to benefit from rising visitor arrivals and steady demand for financial and business services. The government kept its 2026 inflation forecasts unchanged, at 2.5% for underlying inflation and 2.6% for headline inflation.

Private consumption expenditure rose a revised 2.8% in the second quarter, easing from a 4.9% increase in the first quarter. Total goods exports jumped a revised 28.9% year-on-year in Q2, accelerating from 23.8% growth in the previous quarter.