Hong Kong Private Sector Activity Slows Amid Ongoing Expansion and Rising Price Pressures

Hong Kong | EcoPulse24

The S&P Global Hong Kong Private Sector Purchasing Managers' Index (PMI) showed a slight slowdown in December 2025, falling to 51.9 from November's 52.9 - the highest in nearly three years - indicating slower but ongoing expansion.

Output increased for the fifth consecutive month, maintaining one of the strongest paces in over three years despite some moderation. New orders also grew in line with output, posting the second-fastest rise since April 2023, buoyed by robust demand from mainland China and overseas markets.

Purchasing and inventories continued to expand at a slower rate, while supplier performance improved for the first time since May. Improved demand led to a rise in backlogs of work for the first time in a year, accelerating at the fastest pace since November 2024.

Employment declined for the second consecutive month, as firms refrained from replacing departing staff. At the same time, input costs surged due to higher raw material prices and a sharp rise in wage costs, prompting companies to raise selling prices - the steepest price pressure in 26 months.

Business confidence fell to its lowest level since June 2023, amid concerns over the global economy and tariffs.

EcoPulse24 Analysis
The data reflects an ongoing expansionary environment, though with less momentum, as the focus shifts from volume growth to cost and price pressures. Continued external demand - especially from China - supports activity, but weak hiring and declining sentiment suggest operational caution may limit further acceleration if global trade uncertainty persists in the coming months.