China's industrial profits continued to slump in the January-August period, but the pace of decline slowed

　　China's industrial profits extended double-digit declines in the first eight months of the year, but the decline slowed slightly as a series of policy support measures began to stabilize the economy. The year-on-year decline in profits narrowed to 11.7 per cent from 15.5 per cent in the previous seven months, in line with expectations and a possible sign that some companies are already recovering modestly.

　　Corporate profits rose 17.2 per cent in August from a year earlier, after falling 6.7 per cent in July, data from the National Bureau of Statistics (NBS) showed on Wednesday. In the first eight months of the year, profits of state-owned enterprises fell 3.8 percent, those of foreign companies fell 1.3 percent and those of private companies fell 6.1 percent, the breakdown showed.

　　Bruce Pang, chief economist at Jones Lang lasalle, said: "This data reflects that domestic demand has stabilised and there is a balanced recovery on both sides."

　　"A series of policies to promote macroeconomic recovery supported profits last month," said Yu Weining, an NBS statistician.

　　The report showed profits improved in 30 of 41 major industrial sectors, with losses in raw materials manufacturing narrowing sharply on higher commodity prices and recovering demand.

　　After a brief post-pandemic recovery, China has stepped up policy support for the economy and recent data have shown signs of stabilisation, with stronger-than-expected growth in bank lending, industrial output and retail sales in August.

　　But persistent weakness in the crisis-hit housing sector remains a drag on growth.

　　Prices of new homes in China fell at the fastest pace in 10 months last month. There are signs that relaxed lending standards will boost new home sales in some major cities such as China, but analysts say the improvement could be short-lived. Concerns that low confidence in the housing sector could hurt the overall demand outlook for businesses and the economy.

　　A strong recovery in overall earnings growth is still some way off.