Hong Kong's GDP growth rate to increase to 2.4% in 2017

This is versus the previous forecast of 1.8%.

With signs of stronger recovery in advanced economies and stabilisation in mainland China, the Hong Kong economy has shown considerable resilience, according to a report by Hang Seng Bank.

Gross domestic product (GDP) growth was 3.1% year-on-year in the fourth quarter of 2016, far above the 2% forecast by the markets and recorded in the previous quarter.

Consumption was the main driver of growth in the fourth quarter, rising by 3.2%, the highest since the second quarter of 2015, and contributing 2.1 percentage points.

Here's more from Hang Seng Bank:

While net trade reduced growth by one percentage point, the drag was smaller than in the previous quarter. In particular, services exports, of which tourism is a major component, returned to growth after four consecutive quarters of contraction.

For 2016 as a whole, Hong Kong’s GDP growth was 1.9%, a figure at the upper end of the government’s estimate of 1 to 2%. Expecting the growth momentum to continue and assuming a stable global environment, the government now forecasts a further upturn in GDP growth to a range of 2 to 3% for 2017.

Before the release of the 2016 fourth-quarter GDP data, we projected that Hong Kong’s growth should accelerate to 1.8% this year from an estimated 1.4% last year. Given the stronger-than-expected GDP growth in the fourth quarter of last year and the strength of the rebound in consumption, we have upgraded our 2017 full-year GDP growth forecast to 2.4%.

Our view remains that the Hong Kong economy should benefit from further recovery in advanced economies and steady growth on the Mainland, although we are mindful of economic uncertainties such as potential changes in international trade policies.