Profits at China’s industrial corporations in November grew at the highest rate in eight months, breaking a three-month plunging flare, as production and sales quickened, however, broad weakness in home demand remains a threat for earnings in 2020.
Industrial profits in November climbed 5.4% from a year earlier to 593.9 billion yuan ($84.93 billion), National Bureau of Statistics (NBS) data confirmed Friday. That compared with a 9.9% fall in October.
China’s industrial sector has experienced persistent pressure in the past year, with producers fighting sluggish domestic demand and a profit-denting trade row with the U.S. Still, factory activity unexpectedly came back to growth last month for the first time in seven months, a survey showed, following Beijing’s accelerated incentive measures to steady growth.
For January-November, industrial companies notched profits of 5.61 trillion yuan, down 2.1% from a year earlier, however, barely better than a 2.9% plunge in the first ten months.
The growth was mostly attributable to quickening production and sales. At the same time, factory-gate costs declined at a slower tempo, said Zhu Hong, a delegate with the statistics bureau in a statement released alongside the data.
The upbeat figures come in the midst of patchy restorations in industrial supply against lingering weakness in demand at home and abroad.
Industrial production surged at the fastest clip in five months in November, as government support propped up demand on the earth’s second-largest economy and amid easing trade enmities with Washington.
China and the U.S. cooled their 17-month long trade conflict earlier this month, declaring a Phase 1 settlement that would reduce some U.S. duties in exchange for more Chinese purchases of American farm products.