Year-on-year GDP also shrank 2.9 percent, its sharpest drop in a decade. The readings were the weakest for the Asian financial hub since 2008/2009.
Hong Kong is preparing for a major protest on Halloween night that will put its controversial mask ban to test and see thousands of demonstrators march into the city's popular party district for the first time ever.
Despite the hard external and domestic environment, Hong Kong retains its core strengths as an worldwide financial center with an unrivalled geographical location, the rule of law, an independent judiciary, the free flow of information and a wide pool of professional talents, she said.
"As the weakening economic conditions dampened consumer sentiment and large-scale demonstrations cause severe disruptions to the retail, catering and other consumer-related sectors, private consumption expenditure recorded its first year-on-year decline in more than 10 years".
Evans-Pritchard agrees that the near-term outlook "remains downbeat" but says the pace of contraction should ease, "barring a more serious escalation of protests".
The country has been weighed down by increasingly violent anti-government protests and the protracted US-China trade war.
China denies meddling, and has accused foreign governments of stirring up trouble, including the USA and Britain.
Protesters are angry at what they see as Beijing's increasing interference in the Chinese-ruled city.
In the foreground, a protester wears a mask lampooning Hong Kong Chief Executive Carrie Lam.
Hong Kong's economy was already facing strong headwinds at the start of 2019 as it was hit by the US-China trade war, battering a city that is hugely reliant on the world's two largest economies.
One of the biggest factors in determining if Hong Kong will recover - and how soon - is whether mainland Chinese tourists scared away by the protests will return. Those plans follow on earlier initiatives, including the allocation of 2 billion Hong Kong dollars ($255 million) to support small companies and a 19 billion Hong Kong dollar ($2.4 billion) stimulus package to help safeguard jobs and provide relief to "people's financial burden". It has also urged landlords to cut rents for struggling businesses. Mainland visitors still account for nearly 80 per cent of total arrivals in Hong Kong.
"While external uncertainties have brought up vast pressure, I would say that the local situation is much more worrying", she stressed, adding that the ongoing extensive conflicts and violence that have plagued Hong Kong for months have spread chaos and fear and seriously disrupted people's daily lives. "This is it. It's not coming back", said Andy Xie, a Shanghai-based independent economist formerly at Morgan Stanley.