Scan to Download ios&Android APP

China’s industrial profit cools again in August

05:06, 28 September 2021

Share this article

Have a confidential tip for our reporters?

A car assembly plant in Chengdu, China
A car assembly plant in Chengdu, China - Photo: Shutterstock

High commodity prices and Covid outbreak drag down profits of China’s industrial firms. In August, industrial profit rose 10.1% year-on-year, slowest in eight months compared with a 16.4% increase in July, National Bureau of Statistics announced on Tuesday.  

In the first eight months of the year, industrial firms' profits rose 49.5% year-on-year, slowing from a 57.3% increase in the January to July period.

"A sustained and stable recovery in corporate profits is facing more challenges," said Zhu Hong, senior statistician at the statistics bureau, said in a statement translated by Reuters. The original statement is in Chinese.

High commodity prices and Covid outbreak

"The epidemic is still spreading in some areas, overall prices of bulk commodities are high, the cost of international logistics is elevated, and the shortage of chips is pushing up corporate costs," Zhu was quoted as saying by Reuters.

The industrial profit data cemented analysts viewed that China’s economic momentum in the third quarter are ebbing and the economy may only be reinvigorated in the final quarter of the year.

Aside from high commodity prices, companies in China are also facing power curbs as the government is tightening electricity control to meet climate goals. Some power cuts were reported this month, further clouding economic outlook.

Read more: China’s central bank vows to protect housing consumers’ rights

 

Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?


Join the 400.000+ traders worldwide that chose to trade with Capital.com

1. Create & verify your account

2. Make your first deposit

3. You’re all set. Start trading