Hong Kong's Gross Domestic Product (GDP) increased by 5.2% in real terms in the second quarter of 2006 over a year earlier, compared with the 8.0% growth in the first quarter of 2006, according to the preliminary figures of constant price GDP by economic activity for the second quarter of 2006 released by the Census and Statistics Department in September.

Analyzed by constituent sector and on a year-on-year comparison, net output in all the service sectors taken together rose 7.0% in real terms in the second quarter of 2006 over a year earlier, after a strong growth of 9.1% in the first quarter of 2006.

Net output in financing, insurance, real estate and business services increased by 13.8% in real terms in the second quarter of 2006 over a year earlier, after a 13.1% increase in the first quarter of 2006. The growth impetus came mainly from the strong growth in the banking services, on the back of a substantial increase in commission and service income. Also relevant was a leap in net output of the stock brokerage companies, underpinned by the significant increase in stock market turnover in the second quarter.

Net output in the wholesale, retail and import and export trades, restaurants and hotels increased by 6.8% in real terms in the second quarter of 2006, after a 12.4% increase in the first quarter of 2006. The growth was mainly attributable to the continued growth in offshore trade and still vibrant inbound tourism, which helped to cushion the impact of the slackening performance in external trade. Also attributed was the growth in consumer demand.

Net output in transport, storage and communications increased by 6.5% in real terms in the second quarter of 2006 over a year earlier, after an 11.2% rise in the first quarter of 2006. The transport and storage showed some moderation in growth in the second quarter of 2006, upon the slow-down in re-export growth.

Net output in community, social and personal services increased by 1.1% in real terms in the second quarter of 2006 over a year earlier, following a 1.3% rise in the first quarter of 2006.