China’s industrial profits grew 13.9% in March year-on-year, the highest rate since July, in a fresh sign that the Chinese economy is stabilizing.

The upturn compared with a drop of 14% year-on-year in the first two months of 2019, the steepest fall since October 2011 when such data first became available. 

The National Bureau of Statistics said profit growth was mainly helped by accelerating production and sales, stabilizing prices of industrial products and the lowering of the value-added tax.

Analysts with Everbright Securities said the rebound of infrastructure and property investment, as well as the tax cut, will boost industrial firms’ profits in the short term. But as the prospects of China’s trade and housing market are still not very promising, they predict the 2019 growth of industrial profits will be weaker than last year’s gain of 10.3%.

China’s economic growth stabilized at 6.4% in the first quarter, data released on April 17 showed. 

This post has been corrected to state that China’s industrial profits in March grew at the highest rate since July.