Emerging markets' growth slowing, HSBC PMI report says

The Chinese economy - one of the 16 covered - saw its pace of growth fall in February

The economies of emerging markets grew at a slower pace in February than the month before, according to HSBC's monthly purchasing managers' index.

The PMI recorded a level of 52.3, down from from 53.8 in January, its lowest since August.

However, the index remained above the 50 level which indicates growth.

The index covers 16 leading emerging markets, including India, Brazil and China, which all saw their rate of growth fall.

Rates of economic growth in these countries have been far higher than in developed nations, often coming in at about 10% a year.

The eurozone and the UK have barely grown in recent years, while US growth has been in low, single figures.

Investors have questioned whether emerging markets, whose growth depends in part on exports to mature markets, can continue to expand at such fast rates.

Murat Ulgen, chief economist at HSBC, said: "The slowdown appears to be broad-based across manufacturing and services, with BRIC [Brazil, Russia, India and China] activity moderating after a promising start to the new year."

New orders and employment levels both fell.

Mr Ulgen said there were two possible outlooks for emerging economies: "Either the emerging markets will wobble along, buffeted by worries in the developed world.

"Alternatively, the current slowdown will prove temporary, as the inventory cycle works its way through and improved underlying fundamentals bring back the days of strong growth."