China data - May 2020 industrial profits +6.0% y/y (prior -4.3%)

China's industrial profits fell in Q1 and started to be not so bad through March and April as the economy crawled toward recovery.

• May comes in at +6.0% y/y from -4.3% in April
• For January to May (ie. YTD) still down, coming in at -19.3% y/y

Industrial profits are important, they give firms a base from which to build on for investment (capex) ahead.

Virus impacts and its impact on demand both domestically and offshore are obviously the main suspect for China data impacts, but mix in factory gate price deflation (reflected in persistent negative PPIs) also. Profits declined 3.3% in 2019, so were weak even heading into 2020.