China's producer prices in March dropped to their weakest in four months amid decreasing raw material prices.

China's industrial producer price index fell 2.5% year on year and slid 0.4% month on month, according to Thursday data released by the National Bureau of Statistics.

The current index slipped faster compared to the 2.2% decline in February and the forecasted 2.3% drop, Reuters reported Thursday.

The prices of the mining industry dropped 8.3%, and those of the raw materials industry and processing industry fell 2.4% and 2.6%, respectively. The prices of consumer goods slid 1.5%.

As for the purchaser prices, those of ferrous metal materials fell by 7.8%, fuel and power by 6.8%, chemical raw materials by 3.4%, agricultural and sideline products by 3%, building materials and non-metallic materials by 2.1%, and textile raw materials by 2%. Only the prices of non-ferrous metal materials and wires rose at 10.8%.

Lynn Song, ING's Greater China chief economist, said that persisting price pressures kept producer prices negative for the 30th consecutive month.

The US tariffs are also expected to worsen overcapacity issues, likely prompting "further price competition as exporters previously selling to the US market will need to find new buyers," Song said.