To complicate matters, the recent quantitative easing implemented in the United States, Europe and Japan, together with rising momentum in the Chinese economy, have combined to fuel concerns over possible imported inflation.

In January, Chinese financial institutions saw their yuan funds outstanding for foreign exchange increase by 683.7 billion yuan ($108.9 billion), the highest monthly increase on record, data from the central bank show.

To drain liquidity in the market, China's central bank resumed the issuance of repurchase agreements last month.

"We believe the central bank will continue to rely on open market operations to adjust liquidity before moving to raise banks' reserve requirement ratios (RRR) or interest rates," said Liu Ligang, an economist at ANZ National Bank Ltd.

He said inflation concerns would narrow the scope for more monetary easing to boost the economy, which has gained traction since the fourth quarter last year on the back of China's loosening policies to stimulate investment.

On Tuesday, Wen reiterated in his work report that China will maintain a proactive fiscal policy and a prudent monetary policy in 2013 to hit its economic growth target of 7.5 percent.

The central government expects China's broad money supply (M2) to expand by 13 percent in 2013, 0.8 percentage point lower than the actual increase last year.

PPI down 1.6% in Feb

China's producer price index, which measures inflation at the wholesale level, fell 1.6 percent year-on-year in February, the National Bureau of Statistics said on Saturday.

Fixed-asset investment up 21.2% in Jan-Feb

China's fixed asset investment rose 21.2 percent year-on-year in the first two months, down 0.3 percentage point from the same period last year, the National Bureau of Statistics said Saturday.

Industrial output up 9.9% in Jan-Feb

China's industrial value-added output rose 9.9 percent year-on-year in the first two months, down 1.5 percentage points from the same period last year, the National Bureau of Statistics said Saturday.

Retail sales up 12.3% during Jan-Feb

China's retail sales grew 12.3 percent year-on-year to 3.78 trillion yuan ($602.1 billion) in the first two months of the year, the National Bureau of Statistics said Saturday.

Property investment up 22.8% in Jan-Feb

Investment in China's property sector rose 22.8 percent year-on-year to 667 billion yuan ($106.2 billion) in the first two months of the year, the National Bureau of Statistics announced Saturday.

China Economy by Numbers - Jan