China’s industrial profits fell back into sharp contraction in August, official data showed on Friday, adding to a recent string of gloomy readings that point to growing pressure on the economy.
Profits fell 17.8 percent in August from a year earlier after a 4.1 percent rise in July, while profits rose more slowly, 0.5 percent in the first eight months, compared with 3.6 percent in the January-July period, according to the National Office. of Statistics (NBS).
Sluggish data released earlier this month has exacerbated concerns about an anemic recovery, prompting global brokerages to revise down their 2024 China growth forecasts below the official target of around 5 percent. hundred.
Highlighting weak domestic demand, a key bottleneck for the economy amid anxiety over job security and worsening declines in property sales and investment, domestic dairy giant Inner Mongolia Yili Industrial Group Co posted a 40 percent drop in net profit in the second quarter.
To inject much-needed optimism into the economy, China’s central bank on Tuesday announced the most aggressive stimulus since the pandemic, including a 50 basis point cut in banks’ reserve requirements.
But analysts warned that further easing of demand, especially fiscal aid, would be vital to restoring confidence.
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