Global factory growth sags to lowest since September 2010

Global manufacturing growth eased sharply in May to its lowest level since last September, according to a business survey that showed slowdowns across all of its output, new orders, input prices and jobs components.
The J. P Morgan Global Manufacturing PMI fell to 52.9 in May from 55.0 in April, but was still modestly above the 50 mark that divides growth from contraction.
Factory growth eased in Europe and Asia in May, surveys showed on Wednesday, feeding concerns that the world's main economic engines are cooling fast as richer countries curtail orders.
The new orders component of the global survey fell to 51.8 in May from 53.8, with the United States seeing the steepest easing of output and new order growth.
The US ISM survey showed manufacturing growth slipped to its lowest level since September 2009, sending the 10-year US Treasury yield to its lowest since 2010, and compounding weak private payrolls data also published on Wednesday.
Purchasing managers indexes (PMI), measuring the activities of thousands of factories across the world, sank to multi-month lows in China and Europe, where even regional pacesetters France and Germany showed fresh signs of sagging.
The surveys for South Korea, India and Taiwan also showed the pace of factory activity easing, while US figures due later on Wednesday are expected to complete the picture of global manufacturing surge that may be running out of stream.
Some slackening was expected as quake- and tsunami-damaged Japan struggled to churn out parts for the automotive and high-tech industries. Lacklustre growth and consumption in the United States and Europe have also restrained demand.
"I would be loathe to say there's a sharp slowdown in the pipeline, but some momentum seems to be lost," said Mark Miller, global macroeconomist at Lloyds Bank Corporate Markets.
The Markit Eurozone Manufacturing PMI for May slipped to 54.6 from 58.0 in April, its 20th month above the 50 mark that signifies growth but showing a sharp pull-back on fresh signs of decline in the currency bloc's debt-laden periphery. Spanish manufacturers returned to contraction, while Italian and Irish factories saw a marked slowdown in growth. Supply-chain pressures dented the French and German PMIs, which had been hovering near all-time highs.
Survey compiler Markit described the declines in peripheral countries as worrying, suggesting they could face growing difficulty in cutting their enormous public deficits.
"In the case of the eurozone, some of the volatility you're seeing in government bond markets doesn't help, which is clearly a threat to growth via potentially higher longer-term interest rates," said Lloyds Bank's Miller.
Higher interest rates have already had a marked effect on growth in emerging Asia, where investors are nervously watching for any evidence that the slowdown there is worsening as central bankers tighten credit conditions to combat inflation.
That was most evident than in China, where the official PMI touched a 9-month low, below economists' forecasts as new orders fell sharply. A private survey hit its lowest mark in 10 months, held back by power shortages and a clampdown on credit.
If there was a silver lining, it was that factory cost inflation declined in most of the surveys - both in Asia and Europe - which will ease pressure on central bankers to ratchet up inflation-fighting measures.
In the euro zone, there were clear signs that inflation pressures had started to ease.
India was a key exception as price pressures showed no sign of easing, leading economists to predict the central bank will continue on its tightening course. India's PMI dipped to 57.5 in May from 58.0 in April.
In China, where authorities have already taken measures to curb inflation, economists drew a distinction between the current slowdown suggested by the PMIs and the 2008 slump, when the financial crisis decimated global trade.
HSBC's China PMI dipped to 51.6 in May from April's 51.8, holding above the 50-point level which is the dividing line between growth and contraction.
The government's data told a similar story. New export orders dipped to 51.1, suggesting demand was weakening as China's biggest export destinations - Europe and the United States - grapple with slowing economic growth.
The batch of surveys out of Europe emphasised that.
British manufacturing PMI hit a 20-month low in May of 52.1 from 54.6 in April, blamed on a weaker domestic market - especially for consumer goods.