Profit growth slowed slightly in May
June 30, 2014 Category Macro-economy, Weekly
Profit growth at major Chinese industrial companies decelerated in May because of sluggish business, higher inventories and rapidly increasing costs, said analysts. The year-on-year growth rate of 9.8% for the first five months was down slightly from the 10% pace for the first four months, the National Bureau of Statistics (NBS) said. Slower growth in the electronics, coal and general equipment industries depressed the overall rate. Profits of state-owned enterprises increased 3.4% , while they rose 12.9% at private companies. Among the 41 industries surveyed, 32 registered profit growth in the first five months, while eight saw their profits decline. The coal mining and processing industries recorded a 43.9% profit decline in the first five months. Five industries-including vehicle manufacturing, electricity and heating power production and supply-accounted for 77% of the profit growth. Oil refining, coking, and nuclear fuel processing recorded 49.3% profit growth in the first five months, the highest among all industries. Vehicle manufacturing recorded 29.6%. Xu Sitao, Chief Representative of the Economist Group in China, said an improved reading for the manufacturing PMI in May suggested that the slowdown abated slightly in the second quarter.
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