This comes amid a big chill that could deter policymakers from cutting interest rates to prevent excess liquidity.

The price gauge rose 2 percent in November from a year back after a 1.7 percent on-year gain in October. "The rebound was mainly due to significant acceleration in food prices, particularly of fresh vegetables," a Hang Seng Bank report said.

The mercury in Beijing, Shanghai, Guangzhou and 10 provincial capitals hit record lows at the end of last month, boosting vegetable prices by 30 percent amid a supply crunch.

Hang Seng Bank expects the People's Bank of China to keep interest rates steady this year.

But it says the central bank could cut lenders' reserve requirement ratios and keep up open-market operations to adjust liquidity conditions - that is, mop up excess capital and extend more loans. Only 454.3 billion yuan (HK$565.5 billion) of new loans were extended by financial institutions in December, the lowest since January 2010.

Full-year new loans totaled 8.2 trillion yuan in 2012 - 732 billion yuan more than in 2011.

Total social financing, however, saw an uptick as financing through corporate bond issuance, trust loans and entrusted loans beat forecasts to hit 15.76 trillion yuan in 2012, or 2.93 trillion yuan more than the previous year.

"That marks a new era of credit expansion," Wang Tao at UBS said, adding robust growth in social financing would support GDP growth of 8 percent or above this year.

Meanwhile, data on a strong exports rebound in December lifted stock markets yesterday, even though full-year mainland trade missed its growth target.

Exports value grew 14.1 percent on year, a seven-month high, but HSBC analysts are doubtful whether the rally can be sustained amid external headwinds ahead.