Key Findings

• For 1Q26, the Current Performance Index (46.5) and the Expectation Index (46.9) highlighted the cautious stance of the survey participants. This can be taken as reflecting both prudence on the part of exporters as they awaited the US Supreme Court’s final decision on the legitimacy of the Trump-imposed tariffs, and the traditionally subdued approach associated with the Chinese New Year period.
• Among the positive signs, the Current Trade Value Sub-Index (50.9) remained in expansionary territory, while Cost pressures showed signs of stabilising (although continuing to be considered the primary challenge by many exporters). Besides, both the Current and Expected Inventory Sub-Index rose above 60.
• Several key sectors, however, outperformed the overall index reading. Most notably, Jewellery and Clothing enjoyed sizeable rallies. Sentiment, however, softened among Electronics exporters.

Index overview

In general, the readings of the 1Q26 HKTDC Export Confidence Index moderated¹. This saw both the Current Performance Index (46.5) and the Expectation Index (46.9) down on the highs of the previous quarter.

This can be taken as reflecting the cautious stance adopted by many Hong Kong exporters amid the persisting global trade and economic uncertainties, especially the changing US trade policies.²
 

Sub-indices

A greater understanding of exporter sentiment, however, can be gleaned from an analysis of the various sub‑indices.

In terms of the Sales and New Orders Sub-Index, this returned a Current reading of 44.0 (down 11.7) and an Expected reading of 44.7 (down 10.9). With both figures below 50, this can, again, be taken more as reflecting the external uncertainties rather than the local challenges.

By contrast, a more positive picture was in evidence on the supply side. This saw every indication that unit price is expected to hold firm in the first half of 2026, with both the Current (50.9) and Expectation (49.1) readings of the Trade Value Sub-Index hovering around the neutral threshold. Besides, both the Current and Expected Inventory Sub-Index rose above 60, indicating inventory rundown amid growing shipments in the early months of the year.

In another positive development, despite remaining in negative territory, significant improvements to the Cost Sub-Index (Current reading up 15.2 to 38.1, Expectation up 8.5 to 41.3) suggest the likelihood of stabilising cost pressures.

Market outlook

In line with the overall sentiment, the outlook for many of Hong Kong’s major markets moderated somewhat. In the case of the US, its trade policy continues to weigh exporters confidence down, a sentiment reflected in both its Current (34.9) and Expectation (36.4) readings. Beyond that, the ongoing global uncertainties stemming from US trade policy also acted to moderate Expectation levels for the ASEAN bloc (44.4), the Chinese Mainland (43.8) and Japan (36.0).

Industry outlook

It was notable that several key sectors outperformed the overall index reading. In particular, driven by strong sales and sizable new orders, the Jewellery sector rallied, with its Current reading rising to 57.1 (up 5.9) and its Expectation reading climbing to 56.0 (up 1.2). Clothing, too, enjoyed something of an uptick, with its Current Performance climbing to 52.1 (up 6.1), an improvement set to be sustained according to the associated Expectation Index (up 9.2 to 53.4). Less upbeat, however, were Electronics exporters, who returned a Current Performance reading of 44.9 and an Expectation sentiment of 45.6.

The weighting scheme of the five sub‑indices is as follows:

Appendix

The HKTDC Export Confidence Index was introduced in 1Q24. It is a composite of five sub‑indices – Sales and New Orders, Trade Value, Cost, Procurement, and Inventory – and seeks to provide a comprehensive overview of Hong Kong exporter sentiment.

There are two primary / overall indices, one of which gauges the Current Performance in the present quarter, while the other considers the Expectation for the upcoming quarter via a weighted average of the following five sub‑indices:

• Sales and New Orders: This is an indication of overall export performance as well as the level of new export orders received by respondents. This index is compiled based on respondents' feedback regarding the prospects of each of their major export markets.
• Trade Value: This focuses on tracking the movement of unit export prices.
• Cost: This tracks cost pressures as they relate to day-to-day operations, including raw material prices / labour and other operational costs / financing requirements. Compared with the other indices, it is an inverted index, with an index reading above 50 indicating a downward trend for costs, while a reading below 50 indicates an upward trend for costs.
• Procurement: This is a measure of the input-buying activity of Hong Kong traders.
• Inventory: This tracks the overall inventory levels held by respondents for present use and the upcoming quarter. An index reading above 50 indicates a lower-than-normal inventory level, while a reading below 50 indicates a higher-than-normal inventory level.

¹ 1Q26 data were collected during January – February 2026.

² On 20 February, the US Supreme Court struck down President Trump’s tariffs imposed under the International Emergency Economic Powers Act (IEEPA), including the reciprocal tariff and the fentanyl‑related additional tariff. In response to the Supreme Court decision, Trump issued a presidential proclamation on 20 February imposing a 10% global tariff under Section 122. On 21 February he declared that the tariff rate would be raised to its maximum 15 percent level. Further information is available at this Regulatory Alert – US on HKTDC Research.

The HKTDC Export Confidence Index is designed to gauge the prospects of the near-term export performance of Hong Kong traders. To deliver on this, a quarterly survey of 500+ Hong Kong traders from six major industry sectors is conducted. Any index reading above 50 indicates an upward trend and an optimistic outlook, while any index reading below 50 indicates a downward trend and a pessimistic outlook.

As this is a new Index, which debuted in 1Q24, its findings cannot be directly compared with those of earlier studies.