A key economic survey has predicted China’s July manufacturing activity to contract the most in 15 months, driven by rising industrial deflation and dropping commodity prices. The study, conducted jointly by Caixin Media Co and Markit, suggests the foundations of the current economic recovery are still fragile and it is urging the government to implement more policies to support an economic rebound. The preliminary reading of the flash Caixin/Markit Purchasing Managers Index (PMI) fell to 48.2 in July, the lowest since May 2014, down from 49.4 in June. The July figures are the first to be released since the index was renamed after Beijing-based Caixin replaced HSBC Holdings as its sponsor. The sub-index which indicates manufacturing output deteriorated to 47.3 in July, a 16-month low, down from 49.7 in June, while new orders fell to 48.1 from 50.3 in June, the lowest level in 15 months.