The retail prices of 18 types of staple vegetables surged 62.4 per cent in the first two weeks of last month from a year ago.

Although the administrative measures had a short-term effect, economists warn that Beijing will have to stay on high alert for inflation until the first few months of next year, if not longer.

That's because the cause of the problem - an oversupply of money - still exists.

In the official Shanghai Securities News, a column by veteran analyst A Qi on Friday warned that the current round of inflation on the mainland is different from previous ones.

It 'has nothing to do with a rise in demand or a lack of supply', the column said. 'It is driven by the flood of money - a typical case of currency-driven inflation.'

Why there is a need to release so much money into the economy, and where it is being used is unclear.

'It's always a mystery,' said Lu Zhengwei, a senior economist for Industrial Bank.

To get a full picture of the mainland's money supply would take a very large project beyond the scope of an individual researcher - and it has yet to be done, he said.

'Textbook economics holds that the demand for money will increase as a country begins to build up modern industry, which is not hard to understand, for once you've got more business, you need more grease,' Lu said.

But when the money supply climbs to a certain level - say, 100 per cent of the gross domestic product or more - the economy's demand for money will start to shrink, as has been the experience of many other modern economies.

The mainland hasn't followed suit, however. Its money supply has continued to rise, at times more quickly than ever before - particularly during the government's massive monetary stimulus programme, brought in after the global financial crisis hit. Last month, the country's M2, the broadest measure of money supply, was 180 per cent of GDP.

Economists don't want to forecast when the turning point will come for the mainland. They just say they don't see any sign of it yet.

As to where so much money is used, economists are divided in their perspectives. Every explanation is powerful enough to stretch one's imagination to its limit, but none is yet backed by a full set of data.

One is the 'monetisation' of the economy, meaning money is needed to trade things that were previously withheld from trading and were not even not priced in the days of the planned economy. As Zhu Jianfang, chief economist of Citic Securities, put it, that was a time of a 'very low level of society's monetisation', or low-use money.

Lin Songli, senior analyst of Guozen Securities, said a recent example is rural land rights. 'It is only by a gradual process that those rights were allowed to be traded, from farm plots to larger tracts of orchards and woods, then to housing land. But every change has the potential to turn every one of the 600 million rural residents into a buyer or a seller,' he said.

A second explanation highlights the exchange issue, that the yuan is being printed to exchange for all of the country's foreign currency earnings. That demand is unstoppable when its trade surplus continues to swell.

According to the latest figure given by the State Administration of Foreign Exchange, China's international surplus totalled US$102.3 billion in the first three quarters, an increase of 103 per cent from the same period last year. The surplus was mostly due to export performance.

Having to bite the bullet of inflation is a price that China has to pay for keeping its export-led economic model, economic commentator Yu Fenghui said in a recent blog.

But changing the economy's model is hard, and 'we haven't seen real progress yet', according to Liu Yuhui, a researcher with the Chinese Academy of Social Sciences' Institute of Finance and Banking.

A third explanation looks at the rapid development of the yuan's 'regionalisation', in which it is being used directly in trade and in investment in all neighbouring economies, and even more distant lands, even though the currency is not yet officially convertible. Border trade alone, according to the General Administration of Customs, totalled US$30.9 billion in 2008, after a year-on-year increase of almost 45 per cent.

And as a natural extension of 'regionalisation', comes the yuan's 'internationalisation'.

According to He Maochun, a Tsinghua University professor familiar with China's investments abroad, outward direct investment registered with the Ministry of Commerce will see 'a strong boom' from last year's record of US$47.8 billion in all non-finance sectors.

As to the extent of unregistered outward direct investment, He said: 'I can only tell you it's very large. But if you want a number, I don't have it. No one does.'

But, he added: 'There will be a greater boom next year. With Africa already having no shortage of Chinese money, investors are likely to show a rising interest in North America and West Europe.'

Perhaps it is all of these goings-on that have combined to create such a seemingly insatiable appetite for money - along with the country's famous informal banking sector, which the Financial Times recently estimated to be worth six trillion yuan (HK$6.98 trillion).

Many new factories and new jobs have been created by such money, which is a positive side of the story.

But as Peking University economics professor Ma Guangyuan warned in his blog, when so much money flows to a speculative market, it can create a nightmare. So the government must act now, he wrote, or inflation will become 'more dangerous than ever'.