XN000022-1995-11-24 — Page 13

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Hong Kong dollar deposits grew steadily during the third quarter.

The growth in Hong Kong dollar loans however decelerated, caused in part by the weakened demand for home and car financing.

As a result, the Hong Kong dollar loan-to-deposit ratio fell further during the third quarter, by 1.6 percentage points to 105.8% at end-September.

Updated forecasts

The GDP and price forecasts for 1995 have been reviewed by individual components. The updated forecasts are summarised in the table annexed.

In the external sector, total exports of goods are forecast to grow by 13.6% in real terms in 1995, slightly slower than the 13.9% increase forecast earlier.

Within this total, the forecast growth rate of re- exports is kept unchanged at

16% in real terms.

The forecast growth rate of domestic exports is however revised downwards to 3.5% in real terms, from the earlier forecast of 5%.

The moderation in growth of domestic exports since the first quarter was more distinct than earlier expected.

With the recent rebound in the Hong Kong dollar in line with the US dollar thereby affecting the price competitiveness of exports, some further moderation in growth of domestic exports can be expected towards the end of the year.

Meanwhile, manufacturing orders and retained imports of raw materials also showed decelerated increases lately.

The forecast growth rate in real terms of exports of services in 1995 is adjusted upwards to 13%, from the earlier forecast of 11%. This is commensurate with the actual growth of around 13% in the first half of 1995.

In the second half of the year, the growth in exports of services should remain strong, along with the further pick-up in offshore trading, the continued expansion in trade-related services, and the steady uptrend in tourism.