Citigroup suggests the United States-China trade tariff row and even the recent arrest of some Macau casino employees in connection with money changing investigations did not hurt gambling volumes seen in its April survey of the Macau market.
Analysts George Choi and Timothy Chau wrote in a Sunday note about the latest of its monthly surveys of Macau gaming floors: “Despite the ongoing Sino-U.S. trade war – which brings concerns about a reduction in gaming appetite – premium mass wager observed still amounted to HKD11.1 million [US$1.43 million], which is surprisingly flat year-on-year.”
They added, referring to high-value Macau players: “Whales were still actively spotted, and they on average wagered 2 percent higher year-on-year.” The institution defines ‘whales’ as players that have a bet size of HKD100,000 or more.
A note last week from CreditSights Inc suggested demand for Macau gambling was will being supported by forecast 2025 gross domestic product growth for the mainland China economy.
Citigroup’s memo suggested that “the fact that these wagers happen in front of our eyes also suggests that concerns about the Macau police’s recent intensified crackdown on pawn shops that can act as cash exchanges may be overdone – as players are still able to get cash to the gaming tables.”
At the end of March, the Macau authorities said they had disrupted two suspected criminal groups allegedly funding casino gamblers in Macau. It was alleged the suspects had used routes involving now-outlawed unlicensed money exchange, with a total of HKD790 million identified in total transactions.
The bank said the number of premium mass players it observed was 611, or 8 percent higher than April last year.
“This implies that average wager per player still held up reasonably well at HKD18,139,” said the analysts, though they also noted the figure was down 6.8 percent on the HKD19,467 the bank had estimated for April 2024.
The institution added: “We continue to see more whale activities”. This month it observed 19 individual whales – up from 18 in April 2024.
The eight big players this time – which it said were in the “premium mass” segment – wagered a total of HKD4.1 million or HKD217,000 per client, up 2 percent year-on-year relative to its April 2024 survey.
The largest wager seen in this April’s survey “was from a whale at MGM Cotai Supreme Room,” stated Citigroup.
“This player had a HKD4 million chip stack in front of him, and he wagered HKD1 million.” That was the “fifth million-dollar” whale Citi encountered in its monthly survey, since the easing of Covid-related travel restrictions to Macau in early 2023.
In April this time, “the second-highest wager we saw came from a whale at Galaxy Macau’s Horizon Room with a HKD500,000 bet,” added the analysts.
Citigroup added in its Sunday update: “Another interesting point was how the location which whales go to, no longer seems to be altered by the trade conflict; they seem to stick with the venue where they feel most auspiciously comfortable.”
In terms of premium mass wager observed by Citigroup, Macau operators with U.S-based parent firms accounted for about 60 percent of the total in this month’s survey.
“This likely suggests that the ongoing Sino-U.S. trade war does not impact players’ preferences, on an individual operator basis.”
On Thursday, U.S. President Donald Trump raised to a minimum of 145 percent, the U.S. tariff on imports from China. The same day, Beijing raised its own tariffs on U.S. goods to 84 percent and then increased it to 125 percent, the latter rate taking effect on Saturday.
(Updated 12.24pm, April 14)
