The People's Bank of China has drained $7.9B from the country's financial system by selling 48B yuan in repurchase contracts, the first such transaction since June.
The PBOC made the tightening move after weekend data showed that aggregate financing soared to a record 2.58T yuan ($425B) in January from 1.23T yuan in December despite the bank's attempts to rein in lending.
Meanwhile, foreign-direct investment in China climbed 16.1% to $10.76B in January in an indication of continued confidence in the country's economy despite recent cooling,
Separately, the difference in the reported economic output between the national government and China's 31 provinces fell to 10.7% in 2013 from 11% in 2012. The regions' combined output was 62.9T yuan, topping the national figure by a still substantial 6.06T yuan. "Regional authorities are showing more realistic data," says Credit Agricole's Dariusz Kowalczyk. The figures "may reflect the change in emphasis in the assessment of regional authorities away from growth towards other factors, which reduced the incentive for them to inflate the numbers."
The Shanghai Composite ends -0.8%, while a financial index drops 2.1%.