Macau casinos anticipate a slowdown as China intensifies its crackdown on illegal money exchanges.

Macau’s gaming sector may face slow growth in July as Chinese authorities intensify efforts against illegal money exchanges.

According to Macau news agencies, analysts from Morgan Stanley—Praveen K. Choudhary, Gareth Leung, and Stephen W. Grambling—forecasted that the second quarter would see the first negative quarter-on-quarter growth in both industry mass gross gaming revenue (GGR) and corporate EBITDA since the post-COVID-19 reopening. They expect mass GGR to decline by 2% quarter-on-quarter, reaching 113% of 2019 levels, while corporate EBITDA is predicted to drop by 7%, reaching 80% of pre-pandemic levels.

The slowdown, attributed to the crackdown on illegal money exchanges and weaker macroeconomic conditions, consumption, and retail sales in China, may persist into the third quarter, impacting the Macau market. Additionally, the fourth-quarter results could be negatively affected by the anticipated visit of China’s President Xi Jinping, celebrating the 25th anniversary of Macau’s handover to China.

Macau authorities are tackling crime on multiple fronts, including casino fraud and cross-border illegal gambling syndicates. In a recent anti-crime operation, nearly 300 people were detained for investigation, and seven were charged. Police also busted an illegal mahjong operation around Av. Marginal do Lam Mau, arresting four suspects.

Despite these challenges, analysts remain optimistic that the combined EBITDA margins for Macau’s six largest gaming concessionaires will stay strong from June onwards.