Beijing - The pace of Chinese inflation unexpectedly picked up in February, but producer prices continued to slide, underscoring the intense pressure on profit margins at Chinese companies and adding urgency to policymakers' efforts to find new ways to support growth.
The producer price index (PPI) declined 4.8% in February, the National Bureau of Statistics said on Tuesday - the most negative reading posted since Oct 2009 - extending a long-running factory deflation cycle that began in 2012 to nearly three years.
Economists and policymakers worry that the risk of deflation is rising for the world's second-largest economy, as drag from a property market downturn and widespread factory overcapacity is compounded by an uncertain global outlook and soft commodity prices.