National Bureau of Statistics said, earnings at China's large industrial firms dropped sharply in the first two months of the year, as lower factory-gate prices and slower sales ate into profits.

According to the report, China's industrial profits tumbled 14% in the January to February period, extending a 1.9% decrease in December.

Factory-gate prices in automobile, oil refining, steel and chemical all declined in the two month period from a year ago, dropping between 0.4% and 2.5%, dragging on profits of these sectors, the statistics bureau said. The combined decrease in profit shaved the headline profit growth by 14.2%.