PROFITS at industrial firms in China continued to drop in May, reflecting the impact of soft demand and ongoing factory-gate deflation, reports Bloomberg.
Profits in May were down 12.6 per cent from a year earlier, data published by the National Bureau of Statistics. For the January-to-May period, profits declined 18.8 per cent, which was slower than the almost 21 per cent drop in the first four months of 2023.
The sluggish factory data underlines continued economic stresses in China, where the recovery has been flashing warning signs. Exports fell in May for the first time in three months, industrial deflation worsened, and the continued decline in imports underscores how weak domestic demand is.
Profits at foreign firms fell 13.6 per cent in the first five months of the year, slightly slower than in the January-to-April period. Profits at private firms dropped 21.3 per cent, while profits at state-owned enterprises declined 17.7 per cent.