Data released over the weekend showed China's industrial profits fell y/y in March

China's industrial profits March 2024 fell 3.5% y/y, this slowed the gains made for the quarter compared to the first two months.

• In January - February industrial profits rose 10.2% y/y.
• But for Q1 as a whole, profits of China's industrial firms rose 4.3% to 1.5 trillion yuan.

This subdued result adds to the already lacklustre industrial production and retail sales data for March:

• China: March Industrial output +4.5%y/y (expected +5.4%) Retail sales +3.1% (4.5% exp)

The picture in China is still of an economy suffering from weaker-than-desired domestic demand. The industrial profits data we had over the weekend will sap enthusiasm for capex in China.

Exports are a, relative, bright spot.

• China’s Auto Exports Set Monthly Record in March
• China March (USD) exports +14.8% y/y (expected -7.1%) & Imports -1.4% y/y (expected -6.4%)