The industrial profit improved slightly in October, driven by policy stimulus, according to data released by China's National Bureau of Statistics (NBS) on November 27.
China's industrial profits for October declined by 10.0% year-on-year, a notable recovery from the -27.1% recorded in the previous month, reflecting a 17.1 percentage-point improvement. Cumulative profits from January to October decreased by 4.3% year-on-year, compared to a 3.5% decline in the first nine months, marking a 0.8 percentage-point worsening.
In terms of sectors, high-tech manufacturing remained the primary driver of industrial profit growth, with a year-on-year increase of 12.9% in October, contributing 1.9 percentage points to overall profit growth. Specifically, the cumulative year-to-date profits for electrical equipment manufacturing and computer and communication equipment manufacturing were -5.1% and 8.4%, respectively, representing recoveries of 2.1 and 1.3 percentage points compared to the January-September period.
Yu Weining, a statistician at the NBS, stated that the combined effects of existing policies and a series of incremental measures have continued to take effect, driving a steady recovery in domestic consumption demand. This has led to a significant narrowing in profit declines for raw materials and consumer goods manufacturing, while high-tech manufacturing remains a critical support for industrial profit growth.
Recently, China's economy has shown initial signs of recovery under the influence of various policy measures. However, with Donald Trump elected as the U.S. President and his proposed tariffs of up to 60% on Chinese imports, a new wave of trade challenges looms.
In addition, China continues to face trade barriers from the European Union and other countries. These external pressures pose significant challenges to achieving its economic growth targets.