Hong Kong Edition: Why it rarely rains anymore

Reign of fire.

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In this week's Hong Kong Edition, we look at why this year's weather has been so dry, interview the brothers behind the surprise hit movie "Four Trails," warn about the tumbling cost of borrowing and review an Australian-inspired budget cafe by a Michelin-starred team. To subscribe to this weekly newsletter for free, click here.

Climactic Change

It's turning out to be a long dry season. Hong Kong has received 142 mm of rain so far in 2025, less than a third of the average. The shortfall is mostly due to a parched May — just 17 mm of rainfall has been registered this month, compared with the usual 291 mm for the whole month. Reservoirs levels have fallen to 62% of capacity, down from 66% a year ago, with reserves in Tai Tam Upper Reservoir dwindling to 24%.  This dryness reflects a recent pattern. The years of 2020-2024 in general saw below-average rainfall in the first five months of the year, with the exception of 2022, which was much higher, according to analysis of Hong Kong Observatory data. While it's risky to draw conclusions from such a short series, the figures may support the findings of a recent study looking into the dramatic shifts in rainfall in major cities globally as climate change distorts weather conditions. While a majority of the most populated cities are getting wetter, especially in South and Southeast Asia, some are experiencing a drying trend, the research showed. That, notably, includes Hong Kong. Hong Kong is part of just 7% of cities flipping toward a more extreme dry climate, according to an in-depth study released in March by WaterAid, an NGO which worked with academics at Bristol and Cardiff universities in the UK. Hong Kong came fourth after Egypt's Cairo, Spain's Madrid and Riyadh in Saudi Arabia in the study's ranking of metropolises experiencing the most dramatic shifts to drier conditions, based on a predominance of drought months and a reduction in extreme wet months. India's Lucknow, Jakarta in Indonesia and Vietnam's Ho Chi Minh City were among those moving to wet climatic extremes. Hong Kong's weather has been breaking records in all sorts of ways. Last year was the city's warmest year since the city started keeping data in 1884. The mean temperature for autumn was 26.5C (79.7F), the highest tracked. September saw the first waterspout in Victoria Harbour, while in November there were four tropical cyclones occurring concurrently over the western North Pacific and South China Sea — a first for that month since 1961. One of those, Toraji, triggered Hong Kong's first November No. 8 storm warning in almost 80 years. Drier weather doesn't have to mean less rain overall. In 2023, Hong Kong experienced the heaviest rainfall on record, with the city receiving the equivalent of a quarter of a year's total rainfall in 24 hours, which tore up roads, flooded shopping malls and submerged vehicles. No hire please: Taxis stranded after record rainfall in September 2023. Photographer: Lam Yik/Bloomberg Hong Kong's drier-than-normal weather isn't extreme, a Hong Kong Observatory scientific officer said, adding that 80% of annual rainfall typically falls between May and September. The city has seen a long-term trend of wetter conditions, with significant inter-annual variations, the officer said. Due to water piped in from China, the city is less reliant on collecting rainfall in reservoirs for its needs than in the past. Still, Hong Kong needs to invest in innovative ways to ensure a sustainable water supply, the city's leader John Lee said last month at an industry summit. As the city bakes under a hot sun on Thursday, the dry spell appears likely to continue through at least June. The China Meteorological Administration predicts next month's rainfall for swathes of the south, including neighboring Guangdong province, to be as much as 50% below normal. —Richard Frost (rfrost4@bloomberg.net) and Mary Hui (mhui52@bloomberg.net)

Five Minutes With: Robin and Ben Lee

The Hong Kong-based documentary film Four Trails showcases the grueling 298-km (185-mile) endurance challenge and a select group of trail runners who have bravely attempted it. (Read our review of the movie here.) Four Trails has become a surprise hit since its theatrical release in December, pulling in over HK$10 million ($1.3 million) in box office receipts to date, making it the second highest-grossing documentary film ever released in Hong Kong. The movie has also earned a growing list of accolades, including the Audience Choice Award at the Hong Kong Asian Film Festival and Best New Director Award at the Hong Kong Film Awards. We spoke with director Robin Lee and producer Ben Lee, two brothers based in Hong Kong, about the movie's unexpected success and the challenges behind making their first feature film. —Raymond Schillinger (rschillinge1@bloomberg.net) Robin Lee with the Best New Director award backstage at the Hong Kong Film Awards on April 27. Source: VCG/Getty Images Why did you make this movie? Robin: My background as a filmmaker has always been in adventure sports. I filmed for a company called Level One based out of Colorado, which made annual ski films. The trips would take me to places like India, Iceland, Europe, Canada. Then I'd come back and be missing the mountains. So I said, is there anything in Hong Kong which can bring me back out into the mountains? Ben knew about this Hong Kong Four Trails Ultra Challenge, which was very, very niche at the time. And I just thought this was a perfect combination. Why do you think the film has struck a chord with Hong Kong audiences? Ben: I don't think there's been any film that's been popular enough in Hong Kong to showcase Hong Kong in the light that it gets shown in the film. Seeing on a massive Imax screen drone shots of the whole of Hong Kong with beautiful light is rare. Robin: Hong Kong viewers may not even know about extreme sports, and they're watching this and thinking, "Wow, I can't believe we have this in our backyard." So then it also becomes a pride thing where they're just thinking, "How beautiful is Hong Kong? How amazing is my home?" Then they spread the word to their friends, and word of mouth just picked up. I also think the characters in the film, they're very down to earth, they're all relatable. When you break it down to the message of the film, it's human perseverance and if you put your mind to something, you can overcome it. What was the most challenging aspect of making the film? Robin: The most challenging part for me personally was in post-production rather than shooting. We had over 200 hours of content, and trying to take all that content and make it into a structure which flowed from start to finish. All the personalities, they're so different. They've all got different ambitions and goals. How can you tell one person's story next to another person's story without it going all over the place? So, editing was a really big challenge. High and mighty tired: a still from Four Trails. Source: Edko Films Ltd. How do you hope the film will represent Hong Kong with international audiences? Robin: What makes Four Trails so special is that it is one of the hardest trail running races in the world, but it's set in a place where you would never think trail running exists. We not only want to tell an amazing story about this event, but also showcase our home to overseas viewers as well. Ben: Obviously the beauty of Hong Kong. I'd love people to know more about it. We're not just a shopping, finance, dining location. There is so much more to Hong Kong. What's next for the film's distribution? Ben: We want to get it out as far and as wide as possible. We have conversations happening with sales agents and a distributor in the US. Same in the UK. It's going into the Shanghai International Film Festival later this year in June. Hopefully out of that we can find some theatrical release in China. Have you run the Four Trails? Ben: Robin sat behind a computer for 18 months looking at a screen going over and over and over and over and over again. It's our own little Four Trails in a way [laughs]. Robin Lee, director of Four Trails, is an award-winning documentary filmmaker and director, who also works as a commercial director, cinematographer and editor.  Ben Lee is the film's producer and an event director for large-scale professional sports events as well as food & beverage festivals. Together, they run Hong Kong-based Lost Atlas Productions.

Chart of the Week

Three weeks ago, Hong Kong Edition highlighted how a dramatic plunge in the city's interbank borrowing costs was likely to provide a lift to the property market. That proved prescient. Developers have rushed to take advantage of the drop in mortgage rates by speeding up sales of new residential units, while the one-month Hong Kong Interbank Offered Rate, or Hibor, has continued to slide.  Buyers should beware: The cheaper rates are unlikely to last. The decline was driven by the Hong Kong Monetary Authority selling the local currency to stop it from strengthening past the strong end of its trading band with the greenback. The muscularity in the local exchange rate was bolstered by demand for CATL's blockbuster listing, which took place on Tuesday.  The spread between one-month Hibor and its US equivalent, known as SOFR, is now more than 3 percentage points. That means it's intensely profitable to short the Hong Kong dollar against the greenback, known as a carry trade. Indeed, the local currency has been depreciating at a rapid pace. When the US dollar (presumably) reaches the weak end of its band, the HKMA will need to intervene again — only this time its actions will take away liquidity, causing Hibor to rise again.  HKMA Chief Executive Eddie Yue warned as much this week, saying the public should take into account the potential for a further weakening of the Hong Kong dollar and a rebound in local interest rates when making financial decisions. As for the hoary question over the longevity of the 41-year-old peg, genius investor and battler for transparency David Webb said at the Foreign Correspondents' Club earlier this month it was here to stay. "One thing the government doesn't like is to change," he said. "It's known the system since 1983, and it's worked."

The Review: Add Value

Hong Kong's days of excess are in the past. The mainland Chinese shoppers who once shone in gaudy LVMH and Gucci outfits are gone, replaced by backpackers crowd-seeking experiences. Expats who partied on Wyndham Street departed for Singapore, Dubai or London, where they sometimes think of mountain trails and summer junks. Local residents, who protested against the creeping influence of Beijing, now prefer to spend their weekends across the border, where things are cheaper and the service often better. In such a tough market, Hong Kong restaurateurs are increasingly looking to boost business by offering value for money. Servo, a new cafe named after Australian slang for a petrol service station where drivers might pick up a meat pie and a coffee, is emblematic of this welcome trend. Servo on On Lan Street Source: Bloomberg The restaurant, which is more like a coffee shop by day and wine bar by night, is the latest venture by the Arcane Collective's Shane Osborn, Michael Smith and Didier Yang. Located in Central's On Lan Street, opposite their one-Michelin-starred restaurant Arcane, Servo is as unobtrusive on the outside as it is muted on the inside. White walls, light wood tables, darkly dressed staff and metallic open kitchen are matched by the arid brown of the paired bottles of HP Sauce and Vegemite jars in a cabinet by the miniscule kitchen. The only non-neutral color is green — the shade favored by the painter Edward Hopper — seen in a tiny painting of a plant, in stacked plastic crates and outside, in an old sign advertising the site's predecessor Uncle Eric's Vintage Wine Bar. The layout is set up for two people to converse opposite each other on one of the handful of low and high tables, or for solo diners enjoying some introspection at the counter. The food is divided into breakfast, lunch and dinner depending on the time of day, and is prettily served using a similar palette. I went with a guest on a Tuesday at noon — the restaurant is walk-in only — and received a table straightaway. It's worth noting diners are given a 60-minute time slot during breakfast and lunch. My guest is an Australian-Hong Konger, while I am a long-time visitor to the lucky country (experts, in other words), so we were both excited to try the food.  Ham, cheese and jalapeno toastie. Source: Bloomberg Servo bakes its sausage rolls in house, making that a default order (HK$78). In addition, we chose a ham, cheese and jalapeno toastie (HK$88), as well as teriyaki-glazed beef with roasted beets and potato salad (HK$128). We also ordered a (not needed) side salad (HK$20). The food turned out to be as thoughtfully composed as the cafe's design, with each dish giving the diner a good balance of flavors and textures. The pastry of the sausage roll was feathery light with buttery flakes, and the meat well seasoned, while the tomato kasundi  (a mustard-seed-based dip) added sharpness and depth. The bitter-bright bites of jalapeno were the perfect contrast to the cheese-oozing toastie, melded by the tangy sweetness of kimchi in the accompanying salad. Ribbons of smoky, tender, fatty beef married with the creamy, crunchy, pale yellow potato salad and cubes of dark beetroot. To finish, we shared a small rectangle of melty rocky road (HK$12) and a thick wedge of lamington, its dense sponge moistened and enriched by layers of blueberry jam (HK$38). Teriyaki-glazed beef with roasted beets and potato salad. Source: Bloomberg Our total bill came to HK$400. We left Servo satiated and agreeing it was very good value indeed, and that we'd return.  The vibe: A little bit of Nighthawks, splashed with skyscraper-filtered sunlight by day, offering a pleasing view of Zetland Street running at a steep angle down the hill. The giant bottle and carton of milk in the lobby of Kowloon Dairy Building next door add a dose of iconic Hong Kong surrealism, while the presence of Samsen (another good-value eatery) across the road means On Lan Street is rapidly becoming a place for top quality food.  Can you conduct a meeting here? It's a good place for a catch up.  Lamington Source: Bloomberg What would you order again? I would happily reorder any of the dishes we ate. I would also like to try the bacon butty with HP sauce (HK$48) from the breakfast menu, as well as the homemade chicken, leek and mushroom pie for two (HK$258), which is one of the dinner offerings. Vegetarian dishes include smashed avocado on sourdough with chili jam (HK$68) and orecchiette with bolognese sauce and basil pesto (HK$108).  Need to know: Servo is walk-in only and located at the quiet end of On Lan Street, No. 17-19. It's open weekdays from 7:30 a.m. to late (the serving of large plates stops at 10 p.m.), and starting at 9:30 a.m. on Saturdays and public holidays. —Richard Frost (rfrost4@bloomberg.net)

Photo of the Week

Robin Zeng, founder and chairman of CATL, at the Hong Kong ceremony for the world's biggest listing this year. Click here to read our story.  Photographer: Paul Yeung/Bloomberg

Here's What Else Is In the News

Hong Kong's rich families sell their own dwellings to repay debt Hong Kong ramps up tax checks on private equity, venture funds US Treasury warns Hong Kong banks over funding Iran oil trades Former Citi traders drop lawsuit on cost concerns Covid testing demand surges as cases spike across Asia

Coming Up

May 21-July 13: Cirque du Soleil Kooza May 22-25: Affordable Art Fair May 26-30: UBS Asian Investment Conference May 29-30: Capital Markets Forum Hong Kong May 30: Manchester United vs Hong Kong, China May 30-June 8: Hong Kong Ballet: Giselle May 31: Stanley International Dragon Boat Championships May 31-June 1: Hong Kong Whisky Festival  June 2: Book talk with Andrew Mertha on the Khmer Rouge June 10-11: Bloomberg Invest June 13-15: Jimmy O. Yang Live in Hong Kong  June 20-29: Extravaganza! When Brazil Meets Hong Kong July 26: AC Milan vs Liverpool July 31: Tottenham vs Arsenal

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