China’s industrial profits rose 17.6% year-on-year to CNY 4.58 trillion in the first seven months of 2026, easing from an 18.7% increase in the first half, as July growth slowed to 11.2%, the weakest pace in seven months. Official data pointed to concentrated strength in AI-linked manufacturing, including a more than fivefold rise in optical-fiber makers’ profits and an 18.5% gain in the integrated circuit industry that accounted for more than 80% of electronics-sector profit growth, while raw-material producers advanced 55.2% and petroleum processing returned to profit amid Middle East supply disruptions. Property- and consumer-exposed industries remained under severe pressure, with furniture manufacturing profits plunging 58.2% and steel and cement producers hit by weak property and infrastructure investment; Kweichow Moutai also reported a 2% decline in first-half net profit. Factory-gate inflation cooled to a three-month low of 3.5% in July, and after second-quarter growth hit a multi-year low, China’s vice finance minister pledged timely additional fiscal measures, though economists see stabilisation rather than a strong cyclical rebound.