Chinese Prime Minister Wen Jibao has confirmed that his government intends to crack-down on easy lending by state-owned banks, especially to the steel, aluminum, cement and auto industries.
At a key meeting of Chinese economic officials Wednesday, Mr. Wen said investment last year had been "excessive."
Mr. Wen has already ordered banking regulators to launch investigations into lending and investment in some of China's most overheated sectors.
Foreign investment in China also was on the rise in January, increasing 13.6 percent from a year earlier to $4.1 billion.
Meanwhile Wednesday, China reported its first trade deficit in 10 months, with imports exceeding exports by $20 million in January.
Exports rose 19.8 percent on the year, while imports rose 15.2 percent.