Lu Zhengwei, chief economist with the Industrial Bank Co Ltd, said he does not believe the PBOC wants a Chinese monetary easing because the monetary policymakers are still using the rhetoric they used during the economy's overheating cycle.

For example, he said, the PBOC still declares it will "keep the overall liquidity in check" to maintain stability of the domestic monetary environment when the country is faced by increasing capital inflows resulted from all the monetary easing programs overseas.

Although the economy witnessed a slowdown in the first quarter, it has seen four straight months of net foreign exchange purchases by the central bank and commercial lenders, which suggest a continuous capital inflow.

The central bank data showed that banks brought in nearly 1.2 trillion yuan worth of foreign exchange in the first quarter on a net basis, a record high in recent years.

A large part of the capital inflow came from dollar-denominated bonds issued by Chinese companies, especially property developers, in the overseas markets, said Ding Zhijie, dean of the School of Banking and Finance of University of International Business and Economics in Beijing.

The rising purchase of foreign exchange by domestic banks will directly multiply the money in circulation, create excessive liquidity, and exert an inflationary pressure, said E Yongjian, an analyst at Bank of Communications Co Ltd.

"Throughout the year we expect such purchases to continue to grow, but the pace of increase may slow down somewhat from the first quarter," he said.

The threat from the inflow may become moderate in the coming few months because of China's slowdown in economic growth and interference from its monetary regulators.

And a possible exit of US quantitative easing would also help soothe the capital flood, said Zhu Haibin, chief China economist at the JPMorgan Chase & Co.

The Wall Street Journal reported on Monday that the US Federal Reserve is getting ready to wind down its $85-billion-a-month bond-buying program in careful steps, but the timing is still uncertain.

Zhu said that it's most likely that Fed will slow down purchasing the bonds and start to exit before the end of this year. "The transform probably will take six to nine months."