The recent surge in trade values reflects booming exports from mainland China: most of Hong Kong's trade consists of re-exports on their way into or out of China. Out of the $150 billion of October exports, nearly $140 billion were re-exports. Exports of locally manufactured goods actually fell on the month, continuing a long-established trend for Hong Kong to act as an entrepot rather than a manufacturing centre.

Although increases in trade are obviously good for Hong Kong's economy, it's not clear how long China's out-performance can last. The mainland's exports have risen almost 21% year-on-year to US$262.5 billion (HK$2 trillion) in the first 10 months of the year. However, the government said that October exports were also strong to other parts of Asia and to Europe. Not surprisingly, the Californian longshoremens' dispute cut into US exports, making the month's performance even more impressive.

Other news on the economy has not been so favourable, however, with record high unemployment levels and a fourth year of continuing deflation. In a September survey, 51% of consumers expected the Hong Kong economy to deteriorate between September and November, compared with 26% in the previous survey, which was conducted in May. Retail sales figures have dropped by 5% since January, and a growing number of respondents are saving rather than spending, staching away up to 16% of their earnings.