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 above 50 indicate expansion.

The numbers signal a "slight deterioration" in Chinese manufacturing, the report said. A "renewed fall in total new business contributed to weaker expansion of output" while companies trimmed staff, it said.

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.

Policymakers have acted in recent months to counter slowing growth by cutting interest rates and lowering minimum reserve levels for banks.

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