The Hong Kong economy regained some momentum in the second
quarter of 2016, improving from its sluggish performance in the preceding
quarter. Global economic activities picked up somewhat relative to the first
quarter, notwithstanding the lingering uncertainties associated with the US
interest rate normalisation, monetary policy divergence of major central banks,
and geopolitical tensions in various parts of the world. The US economy grew
slightly faster in the second quarter after a slow start to the year, while the euro
area economy expanded moderately. Meanwhile, the Mainland economy
sustained steady growth in the second quarter, underpinned by solid domestic
demand expansion. The downward pressures on production and trading
activities in Asia therefore lessened. Yet, the outcome of the UK vote in
favour of leaving the EU in late June surprised global financial markets, causing
a brief period of financial jitters. The unexpected event has cast a shadow
over the already subdued global outlook, but its impact on the global economy
has so far been limited