Coal piles at Rizhao Port in Shandong Province, China, on November 2, 2021.
Visual CG | Visual China Group | Getty Images
China industrial profits Fall for fourth consecutive month, down 7.3% A comparison of November with the same period last year showed that Beijing’s stimulus measures have not been effective in stemming the decline in corporate profits.
According to Wind information, following a 27.1% plunge in September, profits plunged 10% year-on-year in October, which was the largest decline since March 2020.
Industrial profits are a key indicator of the financial health of China’s factories, utilities and mines. The financial reports show how corporate balance sheets are doing after Beijing took measures to stimulate the economy.
Despite a series of stimulus measures since late September, recent economic data from China suggest that the world’s second-largest economy continues to struggle with deflation, driven by weak consumer demand and a prolonged slump in the real estate market.
Chinese consumer inflation fell to a five-month low in November, while the country’s export and import data were worse than expected. China’s latest retail sales data also disappointed, falling short of expectations.
However, some sectors of the Chinese economy have shown signs of recovery, with manufacturing activity expanding for two consecutive months, hitting a five-month high in November.
Earlier this month, senior Chinese officials pledged at a key economic agenda-setting meeting to step up monetary easing, including lowering interest rates, to support the struggling economy.
this The World Bank raised its economic growth forecast for China on Thursday 2024 and 2025, reflecting recent policy adjustments. China’s GDP is currently expected to grow by 4.9% in 2024, higher than the previous forecast of 4.8%; in 2025, China’s GDP is expected to grow by 4.5%, higher than the organization’s previous forecast of 4.1%.
However, the World Bank warned that China’s troubled real estate sector, coupled with low household and business confidence, will still hinder its growth.
About The Author
