SHANGHAI: Profits earned by Chinese industrial firms in April rose at their fastest pace in six months, data from the National Bureau of Statistics (NBS) showed on Sunday, as factories benefited from higher prices and strong demand.Profits in April rose 21.9 per cent year-onyear to 576 billion yuan ($90.14 billion), the quickest since October, bringing gains for the first four months of 2018 to 15 per cent.The data suggests Chinas industrial sector is still seeing solid growth momentum despite curbs on pollution and rocky trade relations with the United States.Last months rebound was helped by lower comparison figures for April 2017, higher factory prices and stronger demand, He Ping, head of NBS industrial division, said in a statement.It was a significant improvement over Marchs 3.1 per cent growth that was the slowest in over a year and which government officials had blamed on the timing of the Lunar New Year holiday.The higher April data should help ease concerns of slowing momentum in Chinas economy as the country implements tougher pollution controls on smokestack industries and cash-strapped regional governments cut back on big investment projects, curbing demand for building materials.Profit growth for Chinese industrial firms has softened from last years strong pace as factory gate price gains weaken.
In the first four months of 2017, profits rose 24.4 per cent.Chinas producer price inflation picked up to 3.4 per cent in April from March but was much lower than 6.4 per cent in the year-ago period.Weaker profit growth suggests companies may be reluctant to invest and hire new staff, while making it harder for debt-laden firms to service their debt, especially state-owned enterprises that account for the bulk of the countrys high leverage.A Reuters analysis showed that debt growth for Chinese companies has slowed to the lowest rate in more than a decade, but companies have also seen profit margins squeezed to their lowest level in two years.April economic data had shown signs of slowing momentum as investment growth touched a near 20-year low and retail sales growth weakened.