Hong Kong’s retail sector continued on its downward trajectory in June as changing consumption patterns among residents and visitors, as well as a strong Hong Kong dollar, weighed on consumption.

The value of total retail sales dropped 9.7 percent year-on-year to HK$29.9 billion ($3.8 billion) in June, according to statistics from the Census and Statistics Department released on Thursday.

This performance marked the fourth consecutive month of decline, but the rate of decline was slower than in May, when an 11.4 percent decrease on a yearly basis was posted.

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It was provisionally estimated that, for the first half of the year, the value of total retail sales was down by 6.6 percent compared with the same period last year.

The decline is attributed to the changing consumption patterns of visitors and residents coupled with the strong Hong Kong dollar, a government spokesman said.

He added that he expects the retail sector to continue to face challenges in the near term, but that positive factors such as the central government’s various measures aimed at benefiting Hong Kong and the SAR’s drive to promote a mega-event economy will support the sector.

The industry will also benefit from the continuing growth of the economy and rising employment earnings, he added.

Online sales accounted for 7.8 percent of total retail sales in June, with a provisionally estimated value of HK$2.3 billion, representing a year-on-year increase of 5.2 percent.

Sales of medicines and cosmetics ran counter to the overall downward trend. On a yearly basis, the sales value of this category of products increased by 3.4 percent in June.

A notable decline in sales value was recorded in jewelry, watches and clocks, and valuable gifts, which fell by 23.1 percent year-on-year.

“Simply looking at the year-on-year growth of Hong Kong’s retail sector is not a totally correct analyzing method,” Annie Tse Yau On-yee, chairwoman of the Hong Kong Retail Management Association (HKRMA) said at a press conference on Thursday.

“If we analyze the sector through a month-to-month comparison, the situation was better.”

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The June data show that retail sales increased by 2.3 percent when compared with a month earlier.

“Looking ahead, the downward trend is expected to continue until the end of the year or even until March next year,” she said.

But the central government’s move to increase the duty-free allowance for items brought into the Chinese mainland from Hong Kong by mainland visitors from 5,000 yuan to 12,000 yuan will have a positive impact on the sector, she added.

Contact the writer at thor_wu@chinadailyhk.com