China's industrial profit growth slows in June

Finance | 27 Jul 2021 10:48 am

Profit growth at China's industrial firms slowed for the fourth straight month in June, as high raw material prices weighed on factories' margins, pointing to some weakness in the recovery of the world's second-biggest economy, Reuters reports.

Industrial firms' profits grew by 20 percent year-on-year in June to 791.8 billion yuan (US$122.27 billion), data from the National Bureau of Statistics showed on Tuesday, after a 36.4 percent increase in May.

The Chinese economy has largely recovered from disruptions caused by the coronavirus pandemic, but it has faced new challenges in recent months such as higher raw material costs and global supply chain crunches.

"The unevenness in the recovery of corporate profitability still exists, with private firms and small businesses facing a slow rebound," said Zhu Hong, a senior statistician at the NBS, adding that this was due to persistently high commodity prices and disruptions in supply chains.

In the first half of 2021, industrial firms' profits grew a hefty 66.9 percent from a pandemic-induced slump in the same period a year earlier.

Profits in January-June increased 45.5 percent from the same period in 2019, before the global pandemic started.

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