Profits at China's industrial firms rose sharply in May, maintaining the previous month's sizzling pace despite signs of slowing momentum in the world's second-largest economy and an intensifying trade spat with the United States.
Industrial profits rose 21.1 percent to 607.1 billion yuan $92.00 billion) in May, according to data published by the National Bureau of Statistics (NBS) on Wednesday, compared to 21.9 percent growth in April. For the first five months, industrial firms notched up profits of 2.73 trillion yuan, an increase of 16.5 percent from a year earlier, versus a 15 percent increase in the January-April period.
The earnings jump in May was driven by price gains and lower costs, statistics bureau official He Ping said in a statement accompanying the data.
China's industrial firms have benefited from a hot property and infrastructure construction market over the past two years, which helped stimulate demand for building materials from steel bars to copper pipes, glass and cement. And while sales have cooled in the face of government restrictions on home purchases, new construction starts rose 20.5 percent in May and property investment also picked up, suggesting any property slowdown is likely to be relatively modest.
But activity in other parts of the economy including infrastructure investment and industrial output point to softening growth in the world's second largest economy.
While industrial commodity prices have been strong this year, an intensifying trade dispute between Beijing and Washington has rattled China's commodity markets this month as both sides threatened new import tariffs.
Profits at China's state-owned industrial firms rose 28.7 percent year-on-year in Jan-May period, quickening from a 26.2 percent increase in the first four months.