BEIJING, Sept 27 (Reuters) – Profits at China’s industrial firms fell by double digits in the first eight months, but the pace of decline slowed slightly as a series of support measures began to tighten. on some areas of the economy.
The 11.7% year-on-year decline in revenue was down from a 15.5% decline in the first seven months, in line with expectations, which may indicate that some companies are beginning to experience a modest recovery.
Data from the National Statistics Office published on Wednesday confirms this, with August income recording a staggering 17.2% increase over last year. In July, revenue fell 6.7%.
“These data show that domestic demand has stabilized and that supply and demand have recovered in a balanced manner,” said Bruce Pang, chief economist at Jones Lang Lasalle.
NSO statistician Yu Weining said in an accompanying statement that “a series of measures to promote macroeconomic recovery” underpinned last month’s gains.
Profits increased in 30 of the 41 major industrial sectors during the period, and losses in the raw materials manufacturing industry decreased significantly thanks to the increase in raw material prices and recovery in demand. The statistical agency did not provide comparative data from January to July.
As Beijing stepped up support for its economy after a brief post-pandemic recovery, the latest data showed signs of stabilization, with an increase in bank lending, industrial production and retail sales in August were stronger than expected.
However, continued weakness in the crisis-hit real estate sector, which represents a quarter of the world’s second-largest economy, remains a drag on growth.
Last month, new home prices in China fell at the fastest pace in 10 months. The easing of lending rules has shown signs of boosting new home sales in some major cities such as Beijing, but there remain concerns that the improvement may be short-lived.
The concern is that falling confidence in the real estate sector may weaken the overall demand outlook for businesses and the economy.
A breakdown of the statistics agency’s data shows that there is still some way to go for a strong recovery in overall income growth.