Profits of China’s main industrial companies fell at a slower pace in May after manufacturing activity resumed, official data showed Monday. However, Covid-19 restrictions still weighed on factory production and squeezed factory margins.
Profits fell 6.5% from a year earlier in May, improving from a sharp decline of 8.5% in April, according to data released by the National Bureau of Statistics (NBS).
As the conflict between Russia and Ukraine prompted a global rise in commodity prices, the coal mining and oil and gas extraction industries led the way to May’s improvement.
However, profits in the manufacturing sector dropped 18.5% in May as equipment manufacturing improved significantly, senior NBS statistician Zhu Hong said in a statement.
“Overall, the performance of industrial firms has shown some positive changes, but it should be noted that the year-on-year growth of industrial profits continued to fall, with rising cost pressure and difficulties in production and operation,” Zhu added.