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China’s supply-side reforms appear to be working as the world’s second-largest economy is showing positive signs, said Jing Ulrich, managing director and vice chairman of Asia Pacific at JPMorgan Chase.

“In the past many years, the macro economy was always growing strongly but the companies couldn’t make any money. But this year, in the first half of 2017, we’re seeing the macro and the micro (economies) actually performing in sync,” Ulrich told CNBC on the sidelines of the Milken Institute’s Asia Summit in Singapore.

Official reports on China’s economy have shown robust growth ahead of leadership changes later this year.

It’s not just “new economy” sectors like technology and services that are growing, but also traditional industries like steel and cement making that are profitable, Ulrich added.

“China’s supply-side reform actually is kicking in,” she said. “In the past several years, they have been containing capacity growth, they closed a lot of factories in the steel and aluminum sectors. So now, that reform actually has come to fruition.”

JPMorgan still expects, however, that China’s macroeconomic performance will soften in the second half of the year after the strong credit growth and government-driven infrastructure investment in the first six months.