The National Bureau of Statistics reported that coronavirus lockdowns and higher commodity prices negatively impacted the profits of industrial enterprises in China in April, causing the largest drop since the beginning of 2020.
The data showed that industrial profits fell by 8.5% per annum after increasing by 12.2% per annum in March. Economists had expected industrial profits to grow by 2% per annum.
While high wholesale commodity prices contributed to the profit growth of some upstream industries (the mining sector recorded a profit increase of 142%), the profits of manufacturing companies fell by 22.4%.
Meanwhile, from the beginning of 2022 (to April), industrial profit increased by 3.5% per annum, to 2.66 trillion yuan, compared with an increase of 8.5% per annum from January to March.
The report also showed that liabilities at industrial firms jumped 10.4% from a year earlier at end-April, slightly slower than 10.5% growth as of end-March.