Asia's emerging economies appear to be slowing, with data Wednesday showing manufacturing activity easing further last month as governments grapple with persistent inflation.

Figures from across the region showed a pull-back, with purchasing managers' indexes in India, China, Taiwan and South Korea all registering a drop.

In Australia, a 1.2 percent contraction in GDP on-quarter was waved away by government ministers as a weather-related blip, but it was still the sharpest fall in 20 years and added to the mood of an Asian slowdown.

China provided the most eagerly anticipated data of the day, with the HSBC China Manufacturing PMI falling to 51.6 in May from 51.8 in April.

The final reading was higher than preliminary data released by HSBC last month which suggested the PMI had slipped to 51.1 in May. That data triggered falls on the Shanghai and Hong Kong bourses amid fears of an economic slowdown.

A figure above 50 on the index indicates expansion in the sector, while one below 50 indicates contraction.

The gentle slowing will be welcome news for a country grappling with stubbornly high inflation and concerned about runaway growth.

With an eye on the unrest sweeping across the Middle East and North Africa, Beijing has sought to keep a lid on price rises, wary of their potential to cause unrest among the millions whose low incomes have little capacity to cope with increases in the cost of food and basic goods.

China's consumer price index, which is a key gauge of inflation, rose 5.3 percent on year in April -- a slight easing from a 32-month high of 5.4 percent in March but well above Beijing's four percent target for 2011.

The government has raised interest rates four times since October and increased the reserve requirement ratio on several occasions, effectively limiting the amount of money banks can loan out.

HSBC chief China economist Qu Hongbin played down concerns about a potential hard landing for the economy.

"This is still just a moderation rather than a meltdown in growth so there is no need to worry about over-tightening," said Qu.

"Beijing is likely to keep tightening mainly through reserve ratio and rate hikes in the coming months."

Manufacturing activity in India also expanded at a slower pace in May than the previous month, the seasonally adjusted HSBC Purchasing Managers' Index showed.

The index was at 57.5 in May, down from 58.0 in April.

Inflation in India was a punishing 8.66 percent in April, down from the previous month, but still way above the government's target 5.5 percent.

Rampant price rises are a headache for the Congress-led government, which relies on millions of poor voters, who suffer disproportionately when prices rise.

The hawkish Reserve Bank of India has said curbing inflation is a top priority and warned that short-term economic growth may have to be sacrificed.

Taiwan's drop was more stark, with the HSBC PMI falling to 54.9 in May from 58.2 in April. However, the figure is still solidly expansionist.

But in South Korea, manufacturing growth dropped to its slowest pace in six months, with HSBC's PMI falling to 51.2 from 51.7.

Core inflation hit a two-year high of 3.5 percent, while the trade surplus fell by half on easing exports. Together with disappointing industrial production Tuesday, the data indicate declining momentum in Asia's fourth-biggest economy.

"Korea's economy is clearly hitting a soft patch," HSBC economist Frederic Neumann wrote in a research note.

channelnewsasia.com