Excavators transfer coal at the coal terminal in eastern Jiangsu province, China, 22 January 2024.
Str | Afp | Getty Images
China’s industrial profits plunged 17.8% in August from a year earlier, the National Bureau of Statistics said Friday.
This follows a 4.1% year-on-year increase in July, the fastest pace in five months.
Industrial profits cover factories, mines and utilities in China.
In the first eight months, profits of large industrial enterprises rose 0.5 percent to 4.65 trillion yuan ($663.47 billion), compared with 3.6 percent in the first seven months.
The Chinese government stepped up efforts this week to support economic growth amid concerns that Beijing could miss its GDP target by around 5% for the full year. Weak domestic demand, a prolonged slowdown in the real estate sector and rising unemployment have weighed on the world’s second-largest economy.
China’s top leaders on Thursday called for ending the housing crisis and strengthening support for fiscal and monetary policies, according to minutes of a high-level meeting chaired by Chinese President Xi Jinping.
The People’s Bank of China on Friday officially reduced the amount of liquidity banks must have, known as the reserve requirement ratio, or RRR, by 50 basis points. The central bank also lowered the 7-day repo rate by 20 basis points, to 1.5%, from 1.7% previously.
The rate cuts follow central bank Governor Pan Gongsheng’s announcement at a press conference on Tuesday.
In August, China’s industrial activity, retail sales and urban investment all grew more slowly than expected, with retail sales rising just over 2% and industrial production rising 4.5%. compared to last year.
Among fixed asset investments, real estate fell 10.2% in the year through August, the same rate of decline as in July. The urban unemployment rate was 5.3% in August, up from 5.2% the previous month.
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