Profits rising as China rebound gathers pace
Published 28/01/2013 | 05:00
CHINESE industrial companies' profits rose for a fourth month in December, adding to signs the country's economic rebound is gaining momentum.
Net income rose 17.3pc from a year earlier to 895 billion yuan (€106.8bn), the National Bureau of Statistics in Beijing said yesterday. That followed a 22.8pc jump in November. Earnings for the full year gained 5.3pc.
Industrial profits may rise by an average 30pc this year as the world's second biggest economy recovers from a seven-quarter slowdown, businesses start restocking and export demand improves, Standard Chartered forecasts.
Expansion in gross domestic product may accelerate to 8.1pc this year from 7.8pc in 2012, according to analysts.
"This broadly confirms the picture we're getting from other data that industrial and economic growth is picking up again and the pressure on output prices is diminishing," said Louis Kuijs, chief China economist at Royal Bank of Scotland in Hong Kong.
"Because of quite weak numbers in the first half of 2012, the profit numbers are likely to show strong year-on-year growth in the coming months."
The Chinese Academy of Sciences forecast yesterday that economic growth this year will accelerate to 8.4pc.
Preliminary reading of a Purchasing Managers' Index last week showed manufacturing expanding at the fastest rate in two years. If confirmed by HSBC and Markit Economics in their final report on Friday, the gauge would bolster prospects that growth will accelerate from the 7.9pc pace of the fourth quarter.