China’s slowing industrial profits growth adds further evidence to loss of economic momentum
- Industrial firms’ profits in July increased 16.4 per cent on an annual basis – the slowest rate this year – to 703.67 billion yuan (US$108.5 billion)
- Zhu Hong, senior statistician at the National Bureau of Statistics, attributed the slower growth to sporadic coronavirus cases, flooding and high commodity prices
Earnings at China’s industrial firms in July slowed for the fifth straight month, adding to growing evidence of a loss of momentum in the world’s second-biggest economy and bolstering the case for maintaining policy support for a while longer.
Industrial firms’ profits in July increased 16.4 per cent on an annual basis – the slowest rate this year – to 703.67 billion yuan (US$108.5 billion), the NBS said. That compared to a 20 per cent gain in June.
On economic fundamentals, signs of a notable economic slowdown have emerged, and I expect policymakers to fine-tune the macroeconomic policy
“On economic fundamentals, signs of a notable economic slowdown have emerged, and I expect policymakers to fine-tune the macroeconomic policy, currently neutral but with a loosening bias, in an pre-emptive way to counter the headwinds,” said Nie Wen, Shanghai-based economist at Hwabao Trust.
“If growth keeps sliding, the government might even roll out quantitative measures.”