Industrial profits in China decline by 10% in October due to ongoing concerns about deflation.
- Beijing's stimulus measures have not yet reversed the slump in corporate earnings, as evidenced by China's industrial profits dropping by 10% in October compared to the previous year.
- Since March 2020, the steepest year-on-year decline in September was 27.1%.
Beijing's stimulus measures have not yet reversed the slump in corporate earnings, as evidenced by China's industrial profits dropping by 10% in October compared to the previous year.
The sharpest decline in industrial profits since March 2020, which was a 27.1% year-on-year drop in September, indicates the financial health of factories, mines, and utilities in China.
The National Bureau of Statistics announced that China's industrial firms experienced a 4.3% decrease in profits from the previous year in the first ten months, which is higher than the 3.5% decline recorded in the first nine months.
Beijing's recent stimulus measures have aided certain sectors of the economy, but not enough to counteract ongoing deflationary pressures, according to recent data.
In October, China's consumer price index increased by 0.3% from the previous year, which was lower than anticipated, while the producer price index decreased by 2.9% from the previous year, indicating that deflation intensified from the 2.8% decline in the prior month.
The country's industrial production growth was slower than anticipated, while real estate investment decreased by 10.3% in the year through October, a steeper decline than the 10.1% recorded in the previous period.
Despite the challenges, October retail sales surpassed expectations with a 4.8% year-on-year increase, and the unemployment rate decreased to 5%, from 5.1% in September.
In the third quarter of 2023, China's economy, the world's second largest, experienced its slowest growth rate since early 2023 due to weak domestic consumption and a prolonged housing market slump.
The Chinese government has intensified its stimulus measures to support the struggling economy and meet its growth target of approximately 5% since late September.
The official manufacturing purchasing managers' index for November in China is predicted to be 50.3, slightly larger than 50.1 in October, according to a Reuters poll of economists.
A reading below 50 suggests a contraction in activity.
— CNBC's Evelyn Cheng contributed to this report.
This is a breaking story, please check back later for updates.
China Economy
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