China Industrial Profit Growth Loses Steam in August

China's industrial profits rose 4.2% year-on-year in August, the weakest annual gain since November 2025 and the fourth consecutive monthly slowdown.

The pressure is particularly visible in consumer-facing industries, with profits falling in autos, clothing and furniture. Domestic demand remains weak: consumption growth has slowed to near zero, while manufacturers, property developers and infrastructure builders are cutting spending.

For the first eight months of 2026, industrial profits were still up 15.7% year-on-year. However, gains are becoming increasingly concentrated, with the electronics industry contributing roughly 66% of total growth. Raw-material industries added 6.2 percentage points to the overall increase, supported by higher commodity prices.