China’s luxury goods market is expected to grow by 20 per cent this year. In Mainland China, luxury sales grew 18 per cent at current exchange rates, driven by rising demand rather than by price increases. Luxury purchases in Japan softened slightly this year. However, retail sales still grew at three per cent at current exchange rates.

Across the rest of Asia retail sales grew seven per cent at current exchange rates, due to dynamic growth in South Korea. Brisk growth in other Asian countries – Singapore, Thailand and Taiwan – also contributed while Hong Kong and Macau benefitted from Chinese purchases. Europe lagged in 2018 due to a strong euro that impacted tourists’ purchasing power. Local consumption was positive overall, despite mixed country performance, helping to boost retail sales one per cent at current exchange rates.

The Americas grew five per cent at current exchange rates. A positive US economy boosted disposable income and overall luxury spending from locals, even as brands remained wary of continued economic prosperity. In other areas, there was nil growth, mainly due to stagnation in the Middle East. Luxury shopping online continued to accelerate this year compared with physical channels, growing 22 per cent.