Industrial profits rose 21.1% in May from a year earlier, down from a 24.7% increase in April, according to data released by the National Bureau of Statistics (NBS) on Saturday.
China’s industrial profit growth slowed for the first time in six months in May, suggesting that strong exports and higher factory-gate prices were not enough to make up for weak domestic demand.Industrial profits rose 21.1% in May from a year earlier, down from a 24.7% increase in April, according to data released by the National Bureau of Statistics (NBS) on Saturday, Bloomberg reported.In the first five months of 2026, industrial profits increased by 18.8%, slightly below Bloomberg Economics’ forecast of 19%.The slowdown came despite China emerging from factory contraction in March after more than three years, with producer prices rising in May at the fastest pace since 2022. Demand for advanced manufactured goods in China has been supported by a boom in global investment in artificial intelligence, while turmoil in energy markets following conflict in the Middle East has pushed up commodity prices.However, the latest data suggests that these tailwinds are outweighed by a slowdown in domestic investment and weak household spending, which has weighed on corporate profits.The headline growth also reflects a weak comparative base.
Industrial profits fell by 9.1% in May last year.From January to May, industrial enterprises earned 3.14 trillion yuan (462 billion US dollars), lower than the level recorded during the same period in 2022.“The problem of strong supply and weak demand within the country still exists and companies in some industries are still facing difficulties,” Yu Wening, an analyst with the NBS, said in a separate statement.