Profit growth in Chinese companies weakened for the sixth consecutive month

MUMBAI: Profit growth in China's industrial units has been weak on an annual basis in August. For the sixth consecutive month in August, profit growth slowed. Producers are struggling due to high commodity prices, corona surge and shortage of some components.

According to data released by China's Bureau of Statistics, August saw a 10.10 per cent increase in profits compared to 18.50 per cent in July.

The manufacturing sector of the world's second largest economy is weakening due to various challenges. After July 2020, the growth rate of industrial production has been slow in August this year.

Corona re-emergence in China, high raw material prices, tough measures to curb carbon emissions and a shortage of parts such as semiconductors have affected industrial production, the bureau report said.

During the January-August period, the profits of industrial companies grew at an annual rate of 8.50 per cent as against 8.50 per cent in the same month last year. Stable recovery in corporate profits is becoming a widespread challenge.