China’s industrial profits dropped in the first two months of the year, the National Bureau of Statistics revealed Friday.

Industrial profits fell 4.2 percent year-over-year in the January to February period to CNY 745.24 billion. The rate of decline moderated from the 8.0 percent fall seen in December.

A 15.5 percent decline in the raw material costs in the first two months lowered the cost of firms by CNY 564 billion, official data said. But a 4.6 percent decline in product prices reduced their revenues by CNY 733 billion. As a result, net profit declined CNY 169 billion.

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