HONG KONG - Business sentiment among small and medium-sized enterprises in Hong Kong improved for the second consecutive month in March, and the trend is forecast to continue in April, according to official data released on Thursday.

The current diffusion index on business receipts, a monthly index released by the Census and Statistics Department to measure the business performance of SMEs in Hong Kong, rose to 45.5 in March from 43.9 in February in the contractionary zone. The outlook for the index on business receipts for April was 48.

The diffusion index earlier increased from 43.3 in January to 43.9 in February after recording a drop of 2.2 points between December and January

The diffusion index earlier increased from 43.3 in January to 43.9 in February after recording a drop of 2.2 points between December and January.

A reading above 50 indicates that the business condition is generally favorable, whereas that below 50 suggests otherwise.

According to the department, the diffusion index on business receipts for many surveyed sectors rose by varying degrees in March compared with previous month, particularly for the real estate (from 44.5 to 48.4) and import and export trades (from 43.8 to 47.4).

The survey was based on the views collected from around 600 SMEs in selected sectors in Hong Kong, covering wholesale trade, retail trade, import and export trades, restaurants, logistics, real estate, and business services.

A Hong Kong Special Administrative Region government spokesman said that overall business sentiment among SMEs and their expectations on the business situation in a month's time showed further improvement in March while the overall employment situation also turned better.

He added that while the complicated external environment will still affect business sentiment in the near term, continued economic growth and the expectation that financial conditions would show some easing later in the year should bring some support.