China's Economy Rebounds as Industrial Profits Surge in June

China’s industrial profits surged in June, according to data published by the National Bureau of Statistics. Profits at industrial firms rose at the fastest pace in more than a year last month, soaring 11.5% year-on-year. 

Reuters reported that profits at China’s major industrial firms exceeded RMB666 billion in June, which marked the fastest profit growth since March 2019. The data signals China’s gradual economic recovery amid the public health crisis.

In the first half of the year, Chinese industrial firms’ profits dropped 12.8% year-on-year to 2.51 trillion yuan – an improvement from the 19.3% plunge during the first five months. (Industrial profit data covers large firms with annual turnover exceeding RMB20 million.)

While positive profit growth is a clear indicator for an economic rebound, Zhu Hong, an official at the statistics bureau, hints that sustained profit growth may be tough as market demand has weakened due to the pandemic and international trade situation, as cited by Reuters.

At market close on Tuesday, the Shanghai Composite Index was up 0.71% to 3,227.96, while the Shenzhen Composite Index rose 1.37% to 2,173.84.

[Cover image via Pixabay]