BEIJING: Profits at China’s industrial companies increased in the first two months of the year, extending a gaining streak since August and adding to positive signs in the economy.

Industrial profits rose 10.2% from a year earlier in January-February, according to data published by the National Bureau of Statistics.

That was boosted by a low base of comparison a year earlier and came after double-digit growth was recorded in four of the last five months in 2023.

The increase in industrial profits provided more evidence that the world’s second-largest economy is on a firmer footing this year on the back of rebounding foreign demand and policy stimulus by Beijing.

Still, deflationary pressures linger as a property slump and subdued confidence weigh on domestic demand.

Further, falling factory-gate prices have squeezed industrial firms’ profit margins.

For 2023, profits fell 2.3% due to slumps in the first seven months.

Factory output and fixed-asset investment grew faster than expected in the first two months, reports have stated.

 - Bloomberg