EXTERNAL TRADE: Exports up 8.2%
 Merchandise exports grew 8.2% in December as exports to the Mainland gained 8.4%. The performance of other emerging Asian markets in the period was strong, while exports to the United States recorded the first year-on-year increase in eight months, albeit a mere 1.1%. The downside risk to the global economic outlook is increasing amid the ailing U.S. housing market and uncertainties in the financial markets. However, the continued strength in Mainland trade growth and domestic demand, together with a weaker Hong Kong dollar, should offer some support to the export picture.
RETAIL SALES: Double-digit growth
 Retail sales volume grew strongly in December, up 12.4% after a 15.3% increase in November. Demand from local consumers continued to be robust, boosted by the buoyant job market and improved household financial positions, while sturdy growth in visitor arrivals also contributed to sales at retailers.
RETAINED IMPORTS OF CAPITAL GOODS
 The value of retained imports of capital goods in December registered a year-on-year decline after a sharp rebound in November. Large companies surveyed by the latest Business Tendency Survey mostly expressed optimism about the near-term business outlook, and plans for further expansion from local businesses will provide support to investment demand going forward.
PROPERTY: Strong demand continues
The property market maintained its momentum toward the end of 2007, with the number of sale and purchase agreements in December remaining above 10,000 for the ninth consecutive month. Further interest rate cuts from local banks and strengthening household financial positions translated into continued buoyant demand for residential properties, resulting in higher apartment prices and rentals. Home purchase affordability remained fairly strong, particularly compared to pre-1997.
LABOR MARKET: Unemployment rate at 3.4%
 The seasonally adjusted unemployment rate for October – December fell to 3.4%, the lowest level since January – March 1998. Total employment grew 25,700 to an all-time high of 3,533,300, while the total number of unemployed and underemployed taken together fell below 200,000 for the first time since 1998.
COMPOSITE CPI: Inflation at 3.8%
 The inflation rate grew to 3.8% in December. The increase is attributed to sustained above-trend economic growth and heightened global food inflation. For 2007 as a whole, the Composite CPI was on average 2% higher year-on-year. This is in line with the government’s forecast. Excluding the effects of the public housing rental waiver and rates concession, underlying inflation in 2007 averaged 2.8%, up from 2% in 2006.
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