China’s Industrial Profits See Sharpest Fall Since October

China’s industrial profits dropped 9.1% in May, marking the steepest decline in seven months, as weak domestic demand and falling product prices continue to weigh on the country’s industrial sector.

The latest figures from China’s statistics bureau also show a 1.1% fall in cumulative profits for major industrial firms during the first five months of 2025. While mining profits sank 29%, automotive manufacturing was down 11.9%, with state-owned enterprises seeing a 7.4% profit drop.

The slump comes despite earlier stimulus efforts, with analysts suggesting Beijing may not unveil new measures unless broader economic stress emerges. Foreign-invested firms posted a slight 0.3% profit gain, contrasting the wider industrial slowdown.

Economists cite lower global commodity prices as the key factor impacting margins, even as China’s retail and export data show signs of resilience. With GDP growth tracking at 5.2%, policymakers may hold back further stimulus ahead of next month’s key Politburo meeting.