Chinese industrial profit growth slows down, but PMI moves up

02 January 2018

Recent data from China’s National Bureau of Statistics (NBS) appear to show that the industrial growth of the country may have slowed down in 2017. During the period January to October growth in profits from major industrial companies slowed to 21.9%. During the same period in 2016, profits had grown by 23.3%.

Slowdown peaked in November this year when profit growth was at 14.9%, compared to 25.1% in the same month last year. The drop in profit growth of large companies with a revenue of USD 2.87 million or more, is a significant turnaround from just a year ago.

Looking at 2016 data, the industrial profit growth was led by strong sales in electronics, equipment and the oil refining sector. But the Chinese economy nonetheless remains in recovery.

Data from General Administration of Customs (GAC) showed that the imports and exports had risen beyond expert forecasts for November. Total foreign trade volume for November rose 12.6% year on year to 2.6 trillon yuan (USD 400 billion).

In the period January to October the foreign trade volume rose a total of 15.6% to 25.14 trillion yuan USD 3.95 trillion).

Meanwhile, the manufacturing purchasing managers’ index (PMI) released earlier, grew to 50.8 in November from 50.1 in October, the NBS said in its survey tracking the health of some 3,000 large and state-owned companies. This is the fourth consecutive month that the manufacturing PMI has been in growth territory.