XN000022-1990-05-25 — Page 4

FRIDAY, MAY 25, 1990

MOST

THE NUMBER OF VACANCIES IN

SECTORS RECORDED MARKED DECREASES BETWEEN DECEMBER 1989 AND DECEMBER 1990, AND THE PROPORTION OF THE EMPLOYED POPULATION WORKING OVERTIME WAS ALSO SMALLER.

"HOWEVER, GIVEN THE LIMITED LABOUR SUPPLY, THE LABOUR MARKET

REMAINED GENERALLY TIGHT," MR TANG SAID.

HAVING REVIVED CONSIDERABLY SINCE LATE JULY LAST YEAR, THE PROPERTY MARKET WAS RELATIVELY LESS ACTIVE IN THE FIRST QUARTER OF THIS YEAR.

DECREASES WERE RECORDED IN THE NUMBERS AND VALUE OF AGREEMENTS FOR SALE AND PURCHASE AND OF MORTGAGE ARRANGEMENTS.

"WHILE THE MARKET FOR SMALL TO MEDIUM-SIZED RESIDENTIAL FLATS HELD FIRM, DEMAND AS WELL AS PRICES AND RENTALS FOR OTHER TYPES OF PROPERTY GENERALLY SOFTENED IN THE FIRST QUARTER," HE ADDED.

IN THE FINANCIAL SECTOR, THE FOLLOWING DEVELOPMENTS OBSERVED DURING THE FIRST QUARTER.

FIRST.

WERE

REFLECTING A STRONGER U.S. DOLLAR AGAINST SOME OF THE MAJOR CURRENCIES, THE EFFECTIVE EXCHANGE RATE INDEX OF THE HONG KONG DOLLAR ROSE SLIGHTLY.

SECONDLY, LOCAL

HIGHER, KEEPING

INTEREST RATES.

MONEY MARKET INTEREST RATES WERE MARGINALLY BROADLY IN LINE WITH THE CORRESPONDING U.S. DOLLAR

THIRDLY, DEPOSITS AND THE MONEY SUPPLY GREW MORE SLOWLY, IN LINE WITH THE SLOWER GROWTH IN THE ECONOMY.

THE GOVERNMENT ECONOMIST SAID THAT THE ECONOMIC FORECASTS FOR 1990 WERE UPDATED IN THE LIGHT OF THESE DEVELOPMENTS.

"THE FORECAST GROWTH RATE OF THE GDP WAS, HOWEVER, UNCHANGED AT 3 PER CENT," HE SAID.

IN THE EXTERNAL SECTOR, THE FORECAST GROWTH RATE IN REAL TERMS OF DOMESTIC EXPORTS WAS LOWERED FROM 2.5 PER CENT TO 2 PER CENT.

"CURRENT INFORMATION ON RETAINED IMPORTS OF RAW MATERIALS AND SEMI-MANUFACTURES SUGGESTS THAT THE PERFORMANCE OF DOMESTIC EXPORTS

PROBABLY REMAIN WEAK IN THE NEXT COUPLE OF MONTHS,

MR TANG

WOULD SAID.

F

**THE FORECAST GROWTH RATE IN REAL TERMS OF RE-EXPORTS WAS, HOWEVER, RAISED FROM 8 PER CENT TO 9 PER CENT, HE POINTED OUT.

"I

RE-EXPORTS TO MARKETS OTHER THAN CHINA SHOULD CONTINUE TO GROW SUBSTANTIALLY. RE-EXPORTS TO CHINA WOULD PROBABLY RECOVER LATER IN THE YEAR IN LINE WITH CHINA'S MEASURES TO REFLATE ITS ECONOMY.

/"MOREOVER, THE