BEIJING—The slump in Chinese industrial firms’ profits deepened in the first two months of 2023, weighed by lackluster demand and stubbornly high costs as China struggled to fully shake the long-term effects of COVID-19.
The sharp 22.9 percent contraction followed a 4.0 percent fall in industrial profits for the whole of 2022, data from the National Bureau of Statistics (NBS) showed on Monday, pointing to a downbeat start to the year for factories at large.
NBS statistician Sun Xiao attributed the decline to still soft demand despite an uptick in industrial output, according to a statement on the bureau’s website.
Zhou Maohua, an analyst at China Everbright Bank, said a decline in auto sector profits was a notable drag on manufacturing profits, thanks in large part to a moderation in overall demand, production costs, fading auto subsidies, and price wars….