China's industrial profits continue to fall due to declining demand and deflation concerns.

Industrial Profit Decline: China's industrial profits fell for the third consecutive month in July, with a 1.5% decrease compared to the previous year, reflecting ongoing challenges such as subdued demand and factory-gate deflation.

Stimulus Measures: Despite government efforts to boost domestic consumption and curb price wars, these measures have not significantly improved economic conditions amid persistent deflationary pressures and a housing downturn.

Impact of Trade Relations: A trade truce between China and the U.S. has eased tensions, but uncertainty regarding a durable deal continues to undermine business confidence, exacerbating cost competition and overcapacity concerns.

Sector Performance: State-owned firms experienced a 7.5% profit decline in the first seven months, while private and foreign firms saw slight profit increases of 1.8%, highlighting disparities in sector performance amidst broader economic struggles.