HONG KONG’S business outlook continued to drop in October, indicating that there will be no immediate pickup from the recession in the city which is facing a global trade slowdown and domestic unrest and violence.

The purchasing manager’s index for the whole economy dropped to 39.3. the worst result since the depths of the financial crisis in November 2008, according to IHS Markit, which surveyed about 400 private sector companies. Output fell to 32.3, the lowest reading since the series began and well below the 50 level that separates expansion from contraction.

Hong Kong’s economy contracted sharply in the third quarter of the year, amid months of violent protests and ongoing global trade headwinds. Tourism has plummeted across the board, especially arrivals from the mainland, which accounts for almost 80 percent of all visitors to the city.

IHS Markit said business activity was now falling at its fastest rate on record. The latest reading is also sharply down from the 41.5 seen in September.

“The ongoing unrest and impact of trade tensions saw business activity fall at the sharpest pace since the survey started over 21 years ago,” wrote Bernard Aw, principal economist at IHS Markit.

“As new orders continued to fall sharply, led by a record decline in demand from the mainland, firms were becoming increasingly pessimistic about the outlook.”

Hong Kong’s economy was already facing strong headwinds at the start of 2019 as it was hit by the Sino-U.S. trade tensions. In the first quarter of the year, the city was growing at a lackluster 0.6 percent.

Figures released by the government last week showed gross domestic product shrank 3.2 percent in the third quarter compared with the previous three months, when it saw a 0.4 percent drop.

It is the first time the city has witnessed a recession since early 2009 at the height of the financial crisis.(SD-Agencies)