China factory PMI hits unexpected low

Flagging demand dragged China’s giant factory sector into its sharpest contraction in six-and-a-half years in September, a private survey showed yesterday, triggering a flight to safety in Asian markets that analysts say could extend across the globe.

The bleak data came after the US central bank refrained from lifting interest rates for the first time in nearly a decade last week, citing concerns that global problems, and China’s slowing economy in particular, may hurt the US recovery.

The preliminary Caixin/Markit China Manufacturing Purchasing Managers’ Index fell to 47 in September, the worst since March 2009, missing market expectations for 47.5 and slipping from August’s final 47.3. Levels below 50 signify a contraction.