The People's Bank of China (PBOC), or the central bank, on Thursday moved to drain liquidity from the banking system through its open market operations as inflation rebounded modestly in the world's second-largest economy.

After selling 20 billion yuan (3.17 billion U.S. dollars) of 91-day repurchase agreements (repo), the PBOC took out 44 billion yuan of funds from banks in its open market this week, marking the first weekly liquidity tightening this year.

Analysts said the central bank has stepped up its tightening of short-term liquidity in the money market in a flexible way according to the country's inflation data.

The Consumer Price Index (CPI) rose 4.5 percent year-on-year in January, accelerating from 4.1 percent in December last year, according to the National Bureau of Statistics on Thursday.

"Due to the rebounding inflation, the market expects a delay in monetary loosening," said Jiang Chao, chief macroeconomic analyst for Guotai Junan Securities. "Despite the pickup of inflation in January, the overall trend for CPI to ease in the short-term is still unchanged."

The CPI increase was mainly boosted by food price surges in January when Spring Festival fell this year, said Lian Ping, chief economist at the Bank of Communications.