Gold has slumped another 1.1% to a new five-year low of just over $1.080 a troy ounce, while prices for copper hit a six-year low below $2.36 a pound. Nickel and aluminum, two other base metals that also historically serve as good indicators of demand from global industry, also came close to new six-year lows, as traders increasingly lose faith in the main factor that has supported prices for the last decade–supposedly limitless demand from China.

The news is bad news for the global economy in general, as Chinese demand for raw materials has been a major prop to emerging markets for the last 20 years. Countries from Chile and Angola to Australia and New Zealand have come to depend on Chinese demand for their natural resources, and all are seeing their economies falter and their currencies fall as the biggest engine of global growth struggles. The International Monetary Fund earlier this month revised down its forecast for global growth this year to 3.3% from 3.5% (although that was mainly due to a weak first half in the U.S. rather than to Chinese factors).

Sentiment in global commodity markets has taken a turn for the worse in the wake of China’s second-quarter gross domestic product data and the drastic measures taken to control the deflation of a stock market bubble. The annual growth rate of 7% announced by the authorities seemed to be at odds with economists’ assessment of other indicators, prompting fears that the country is massaging its data. At the same time, the widespread suspension of stocks on the mainland market, coupled with heavy-handed measures to support prices and stop investors selling, has fostered doubts as to the authorities’ stated commitment to market-oriented reforms.

Markit’s flash estimate of its purchasing managers index, which is based on anecdotal replies from businessmen across the country rather than the calculations state-appointed statisticians, fell to a new 14-month low of 48.2 in July from 49.4 in June, while the manufacturing output sub-index fell to a 16-month low of 47.3 from 49.7. A reading of 50 typically reflects the line between growth and contraction.

Markit

That was short of market expectations, and markets were alarmed by how broad-based the deterioration was. New orders, export orders, employment and prices all fell, while inventories of unsold goods rose.

The Shanghai Composite index, despite the heavy restrictions on trading now in place, fell 1.3% in response to the news, but is still up more than 25% from its recent bottom, thanks to buying funded by state-backed entities. Even so, analysts have started to worry that the amount of wealth destroyed by rout since mid-June may be having knock-on effects at national level by depressing spending and consumer confidence.