Chinese industrial firms’ profits further declined in August, indicating increased downward pressure on the economy amid the continued economic slowdown coupled with stock market crash, the National Bureau of Statistics (NBS) said today.
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Profits of China’s major industrial firms fell 8.8 percent year on year in August, sharply down from a 2.9-percent decline posted in July, the National Bureau of Statistics (NBS) said on Monday. It was the biggest drop since the government began releasing monthly data October 2011, according to data compiled by Bloomberg.
China’s stock-market plunge and currency devaluation are adding new challenges for the world’s second-largest economy as it struggles with excess capacity, sluggish investment and weaker manufacturing.
Financial expenditures of industrial firms’ increased by 23.9 percent in August from a year earlier, compared to a 3 percent annual drop in July. In total, August profits were down 156.6 billion yuan (16 billion pounds) from a year earlier.
For the first eight months of 2015, profits were down 1.9 percent from a year earlier, the bureau said.
It also added that rising costs, waning demand for industrial products, and a profit slump in the automobile, petroleum and chemical industries also contributed to the profit decline.
The NBS said investment returns for industrial companies from a year earlier increased by 4.12 billion yuan in August, compared with a gain of 11.04 billion yuan in July.
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“The easing growth in inventory would relieve companies’ inventory pressure and ease their operation difficulties”, he said.
