Associated Press Wire

Mar 24, 7:17 AM EDT

Report says China manufacturing at lowest in nearly a year



Interactive
Made in China: Too Many Imports Too Soon?
Latest News
Report says China manufacturing at lowest in nearly a year

Multimedia
Video photo gallery on trash in China
China celebrates 60th year
Panorama of Tiananmen Square
Remembering Tiananmen
A year after China quake
Migrant laborers struggle to find work
Checking Beijing's Air
China's morning exercises in parks
Exploring Chinese Cuisine
Beijing Architecture Changes For Games
Woman Rescues Homeless Quake Dogs
China Holds Funeral for Panda
China's 1-child Policy Causes Extra Pain
Map of Earthquake Zone in Central China
Entrepreneurs Move Into, Out of China
Olypmics in Beijing Highlight China's Water Woes
Foreign Buyers Head to China Despite Problems
Coal Use Produces Pollution, Illness
Coal Means Profit, Woes for China
China Extending Its Reach Around the World
In China, the Desert Closes In
Latest News
Chinese president promotes regional vision at Boao Forum

Chinese NGO considering legal action over police raid

Philippines says China rushing construction in disputed sea

China to invite foreign militaries to take part in parade

China's 'dancing grannies' irk neighbors, face new rules

Buy AP Photo Reprints
Interactives
Interactive about job growth
Quiz for Older Job Seekers
Who Has Lost the Jobs? A State by State Look
Audio Slideshow
Panorama of Tiananmen Square
Remembering Tiananmen

HONG KONG (AP) -- China's manufacturing fell to the lowest level in nearly a year as new orders shrank, according to a report Tuesday that underscored the weakening outlook for the world's second biggest economy.

HSBC's preliminary manufacturing index based on a survey of factory purchasing managers dropped to an 11-month low of 49.2 in March from February's 50.7. The index is based on a 100-point scale on which numbers below 50 indicate contraction in activity.

The numbers signaled a "slight deterioration" in Chinese manufacturing, said the report, which found decreases in sub-indexes for new orders, new export orders and employment. It was the first report since the Lunar New Year holiday, which tends to distort economic data because it falls at a different time in January or February each year.

"A renewed fall in total new business contributed to weaker expansion of output while manufacturing companies continued to trim their workforce numbers," said Annabel Fiddes, an economist at Markit, which conducted the survey.

The weakness in China's massive manufacturing industry, which employs millions, is a challenge for Beijing as it tries to prevent the economy from slowing too sharply.

China's economy expanded 7.4 percent last year, its slowest pace in nearly a quarter century, and economists predict growth will slow further this year and the next.

"Today's weaker-than-expected PMI reading is the latest in a string of disappointing data out of China and strengthens our view that the economy likely slowed sharply" in the first quarter, said Julian Evans-Pritchard, an economist at Capital Economics.

Policymakers have acted in recent months to counter slowing growth by cutting interest rates and lowering minimum reserve levels for banks and Evans-Pritchard said he expected more of the same in coming months.

The preliminary results of HSBC's survey covers 85-90 percent of responses from more than 420 manufacturers. The final version is due out April 1.

© 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Learn more about our Privacy Policy and Terms of Use.