China’s industrial profits retreated in October after two strong months, reflecting ongoing weakness in domestic demand and the drag from softer export orders.
- Official data released Thursday showed profits falling 5.5% year-on-year, reversing the 21.6% surge seen in September and the 20.4% gain in August. The -5.5% was the worst in five months.
- Profit gains for the first ten months of 2025 stood at 1.9%, easing from the 3.2% increase recorded through September.
- By ownership, profits for state-owned firms were flat over the first ten months, while private companies posted a 1.9% increase and foreign firms saw a 3.5% rise.
The setback is likely to reinforce calls for stronger policy support to bolster household spending and reduce the economy’s dependence on exports amid persistent tariffs and rising trade barriers.
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The figures underline the structural challenges facing the world’s second-largest economy. Growth momentum has faded sharply, with third-quarter GDP slowing to its weakest pace in a year.
Earlier data showed October retail sales underperformed despite an extended national holiday and the launch of Singles’ Day promotions, while producer prices remained in deflation and factory output grew at its slowest annual rate since August 2024.
Beijing has signalled a shift toward prioritising consumption over the next five years, though it has avoided deploying broad stimulus. High youth unemployment and a prolonged property downturn continue to weigh on confidence. The data cover industrial firms with annual operating revenue above 20 million yuan.
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The data underscores patchy manufacturing momentum, offering limited support for China-sensitive commodities and adding to the argument for further targeted policy support.
