The euro zone is on track for its second recession in three years and China's once booming manufacturing sector is contracting at a faster pace than previously reported.

The US is also seen as struggling to keep up its pace of growth.

Business surveys released today painted a global picture of economic malaise from Beijing to Berlin.

The euro zone economy will shrink around 0.5% in the current quarter as the economic slowdown is even spreading through Germany, Markit's Purchasing Mangers' Index (PMI) suggested.

This came after HSBC said its Flash China manufacturing PMI fell to 47.8 for August, its lowest level since November and well down from July's final figure of 49.3.

Growth in the US manufacturing sector is also expected to have slowed in August. That US data is due out later this afternoon.

The euro zone composite PMI, which measures manufacturing and services together, was actually slightly better than a month earlier, nudging up to 46.6 and just pipping forecasts for it to hold steady at July's 46.5. But this was still its seventh month in a row below 50, the dividing line between contraction and growth.

"August's flash euro zone PMI does nothing to challenge the notion that the single currency area is now firmly in recession," economists said.

More worryingly, the downturn in smaller euro zone economies is clearly taking root in the core. The flash composite PMI for Germany fell to a three-year low, a fourth month of contraction in a row.

German economic growth slowed to 0.3% in the second quarter on a sharp drop in investment, adding to evidence that it can no longer be relied on to pull the euro zone out of a deep slump.

The euro zone economy shrank by 0.2% in the three months to June, according to official data earlier this month. Economists polled by Reuters last week predicted a similar outcome for the current quarter, with no growth until the start of next year.

Euro problems putting Asian economies under pressure

Falling demand from debt-ridden Europe, China's single biggest export market, has put the Chinese economy under pressure, with the ripples now being felt across the world.

Japan said yesterday that exports slumped the most in six months in July as shipments to Europe and China tumbled. Exports from Taiwan, a key part of the global technology supply chain, fell for a fifth month in a row in in July and South Korea, home to major carmakers, computer chip and flat-screen producers, recorded its sharpest export fall in July in nearly three years.

Six consecutive quarters of slowing Chinese growth have also taken a toll on commodities markets, with falling prices and an uncertain outlook prompting miner BHP Billiton to shelve a $20 billion expansion project in Australia.

China has been fine tuning policies to keep growth on track without releasing curbs on the property sector. In contrast central banks in the developed world have slashed interest rates to near zero and injected trillions of dollars into the money supply in efforts to support growth.

The European Central Bank is expected to cut rates by 25 basis points to a new record low of 0.5% when it meets next week, but analysts say that will do little to stimulate lending.

The US Federal Reserve is likely to deliver another round of monetary stimulus "fairly soon" unless the economy improves considerably, minutes from the Fed's latest meeting suggested.