BEIJING (Reuters) – The contraction in China’s industrial profits eased in November, signaling tentative progress as policymakers commit to stronger measures to bolster the nation’s sluggish economic recovery.
Industrial profits fell 7.3% year-over-year in November, improving from a steeper 10% decline in October, according to data from the National Bureau of Statistics (NBS). However, cumulative profits for the first 11 months of the year slipped by 4.7%, extending a 4.3% drop recorded in the January-October period.
China, the world’s second-largest economy, continues to grapple with weak post-pandemic recovery momentum. Business and household spending remain lackluster, hampered by a protracted housing market downturn and the prospect of increased trade tensions under the incoming U.S. administration led by President-elect Donald Trump.
Recent economic data has painted a mixed picture. While industrial output gained momentum in November, new home prices declined at their slowest pace in 17 months, indicating uneven progress across sectors.
At a key policy meeting this month, Chinese leaders vowed to bolster economic stability through a combination of fiscal and monetary measures. Plans include raising the deficit, issuing additional debt, and loosening monetary policy to safeguard growth. Policymakers have also promised targeted support, such as increased fiscal aid for consumers and enhancements to social security programs.
In a significant step, Beijing has approved the issuance of $411 billion in special treasury bonds for 2025, marking a record level of fiscal stimulus.
A closer analysis of NBS data reveals that profits for state-owned enterprises declined 8.4% in the first 11 months, while foreign-invested firms posted a 0.8% dip. Meanwhile, private-sector companies saw a modest 1% drop in profits.
The industrial profit statistics encompass companies with annual revenues exceeding 20 million yuan ($2.7 million) from their primary operations.
As Beijing accelerates its fiscal and monetary interventions, investors and analysts will be closely monitoring whether these efforts can sustain a more robust economic turnaround in the coming months.
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