Excavators transport coal at the coal terminal in east China's Jiangsu Province, January 22, 2024.
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Data from the National Bureau of Statistics on Friday showed China's industrial profits fell 17.8% in August from a year earlier, marking the sharpest decline in more than a year.
That followed a 4.1% year-on-year increase in July, the fastest increase in five months. Industrial profits data includes factories, mines and utilities in China.
The 17.8% decline was the largest since an 18.2% drop in April 2023, according to official data accessed by Wind Information.
The statistics office attributed the sharp decline in August to a high base in the same period last year. In August 2023, the same monthly value increased by 17.2% year-on-year.
The decline weighed on industrial profits for the year. In the first eight months of the year, profits at major industrial companies rose 0.5% to 4.65 trillion yuan ($663.47 billion), compared with a 3.6% increase in the first seven months.
During this eight-month period, the mining and oil industries saw the largest decline in profits. Smelters and processors of metals other than iron recorded the largest profit increases during this period.
Electronic equipment manufacturers and the food processing industry also reported significant profit increases during this period, the statistics office said.
State-owned enterprises reported a 1.3% decline in profits in the first eight months of the year, while non-state-owned enterprises reported a 2.6% increase in profits.
Foreign industrial companies, including those with investments from Hong Kong, Macao and Taiwan, posted a 6.9% year-on-year profit increase in the January-August period.
The Chinese government stepped up efforts to support economic growth this week amid concerns Beijing could miss its full-year GDP target of about 5%. Sluggish domestic demand, a prolonged real estate downturn and rising unemployment have weighed on the world's second-largest economy.
On Thursday, China's top leaders called for halting the housing downturn and strengthening fiscal and monetary support, according to a high-level meeting chaired by Chinese President Xi Jinping.
The People's Bank of China on Friday officially cut the reserve ratio (RRR) that banks must hold by 50 basis points. The central bank also cut the seven-day reverse repurchase rate by 20 basis points to 1.5%, from 1.7% previously.
The rate cuts followed central bank Governor Pan Gongsheng's announcement at a news conference on Tuesday.
In August, China's industrial activity, retail sales and urban investment all grew slower than expected, with retail sales rising barely more than 2% and industrial production rising 4.5% from a year earlier.
In terms of fixed investment, real estate fell 10.2% in the year to August, the same pace of decline as in July. The city's unemployment rate was 5.3% in August, up from 5.2% the previous month.
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