China's consumer prices dropped in February while factory-gate prices saw a slowdown in annual declines, official data showed on Sunday.

The country's consumer price index, the main gauge of inflation, fell by 0.7 percent year-on-year in February after a 0.5 percent rise in January, according to the National Bureau of Statistics.

Dong Lijuan, an NBS statistician, attributed the decrease to factors like the timing difference of the Spring Festival holiday, which started in January this year compared to February last year, leading to a high comparison base.

Other contributing factors include favorable weather in February, which benefited the growth and transportation of fresh vegetables, as well as price cuts and promotions on automobiles and other goods, Dong added.

Within the CPI, food prices dropped 3.3 percent year-on-year in February versus a 0.4 percent annual growth in January. The price of fresh vegetables declined 12.6 percent in February versus a 2.4 percent rise in January.

Meanwhile, prices of gas-powered cars and new energy vehicles declined 5 percent and 6 percent, respectively.

Month-on-month, the CPI dipped 0.2 percent in February, following a 0.7 percent rise in January.

Meanwhile, China's producer price index, which gauges factory-gate prices, dropped by 2.2 percent year-on-year in February, narrowing from a 2.3 percent fall in January, the NBS said.

Dong noted that the decrease in factory-gate prices was influenced by the seasonal slowdown in industrial activity during the Spring Festival holiday, with many construction projects halted, weighing on demand for building materials. Meanwhile, ample coal supply and global oil price fluctuations contributed to lower petroleum-related prices domestically.

However, as the macroeconomic policies gradually takes effect, rising production demand in some sectors helped narrow the decline in PPI, Dong added.

On a month-on-month basis, the PPI dropped 0.1 percent in February after a 0.2 percent decline in January, according to the NBS.