BEIJING, March 24 -- China's manufacturing activity in March fell again to an 11-month low of 49.2, according to HSBC's preliminary purchasing managers' index (PMI) released on Tuesday, signaling weaker growth momentum and pressure on policymakers to further ease policies.

The HSBC flash manufacturing PMI for March, the lowest since May 2014, came after a reading of 50.7 in February, and was much weaker than the market consensus of 50.5.

A reading above 50 indicates expansion, while a reading below that represents contraction.

The March reading -- the first data point since China's Spring Festival free of holiday distortions -- suggested that underlying demand has weakened further since late 2014, according to an HSBC research note.

"Weak domestic demand was the main reason for today's low reading. New orders fell into contraction, while the output sub-index also moderated from the January-February average of 51," the HSBC research note said.

New orders in March fell to an 11-month low of 49.3 from 51.2 in February, while the output sub-index stood at 50.8 in March, down from 51.7 in February, representing a two-month low, according to the monthly report.

The weak domestic demand is putting downward pressure on the labor market, with the employment sub-index falling from 49.8 in February to 47 in March, the lowest level since September 2014, HSBC said.

The PMI "signalled a slight deterioration in the health of China's manufacturing sector in March," said Annabel Fiddes, an economist at Markit.

"A renewed fall in total new business contributed to a weaker expansion of output, while companies continued to trim their workforce," Fiddes said.

The view was echoed in a Barclays report, saying that "the deteriorating PMI confirmed that downside risks to China's 2015 growth rate have started to materialize."

Barclays recently revised down its 2015 China gross domestic product (GDP) growth forecast to 6.8 percent from 7 percent in view of likely weaker-than-expected Q1 growth.

It expected downside risks, including a property market correction and elevated local government debt, to prevail in the near term, though the slowdown is partially cushioned by more government-led infrastructure investment.

China's GDP expanded 7.4 percent last year, the lowest since 1990. The annual economic growth target for 2015 was set at around 7 percent, roughly half a percentage point lower than last year.

The HSBC flash manufacturing PMI data came after the release of economic data for January and February, which was far from optimistic.

Industrial output in the world's second largest economy grew 6.8 percent year on year in January-February, down 1.1 percentage points compared to that in December. Retail sales expanded 10.7 percent in the first two months from a year earlier, also down from 11.9 percent registered in December.

To halt the economic slowdown and the onset of deflation risks, the People's Bank of China has cut the benchmark interest rates twice and dropped the reserve requirement ratio (RRR) for banks over the past four months. Some analysts expect more easing moves.

Barclays forecasts that the next RRR cut could happen in the coming weeks and expects more RRR cuts in the event of weaker economic performance and persistent capital outflows.

China International Capital Corp. suggested there is room for policy easing, forecasting six more RRR cuts and one more 25 basic points benchmark interest rate cut this year.

Speaking at a press conference on the sidelines of the National People's Congress annual session earlier in March, central bank governor Zhou Xiaochuan said there would be some room for flexible adjustments of the prudent monetary policy.