Investing.com - Profit at large Chinese industrial firms dropped at the fastest pace since 2011 in the January-February period, official data from the National Bureau of Statistics showed on Wednesday.
Profits dropped 14% year-on-year to 708.01 billion yuan ($105.50 billion), their worst contraction since late 2011.
The fall in profits was mainly due to price contractions in key industrial sectors such as auto, oil processing, steel and chemical industries, Zhu Hong of the statistics bureau said in a statement accompanying the data.
He also noted that the timing of Lunar New Year holidays this year also had a more significant negative impact on the business environment than in 2018.
The fall came even after Chinese Premier Li Keqiang announced tax cuts and infrastructure spending earlier this month that are worth hundreds of billions of dollars.
Uncertainty surrounding the Sino-U.S. trade war might have a negative impact on China’s economic growth.
While officials from the U.S. and China have publicly said trade talks between the two sides have been going well, the optimism of a quick trade deal faded somewhat earlier this month after U.S. President Donald Trump said tariffs on Chinese export could stay in place for a “substantial period of time.”
His comments caused some confusion among analysts who have been following the trade developments. Earlier this month, it was reported that some officials from Beijing are not happy with the lack of assurance that tariffs on Chinese goods would be lifted.