First, the PBOC is forbidden by law to buy government bonds directly. Second, the primary aim of injected liquidity is to provide a monetary base rather than bailing out local governments, said Zhao. The PBOC already has enough tools to create the monetary base, so has no need to buy government bonds in the secondary market.

The PBOC will continue to ease monetary policies through RRR cuts, rate cuts and liquidity injections, but QE is not the correct term for its framework of monetary easing, as its balance sheet has never stopped expanding and will not suddenly jump due to asset buying like that of the the US Federal Reserve (Fed), the European Central Bank (ECB) and the Bank of Japan (BOJ).

QE has been taken in the United States, Japan and Europe to boost economy.

China's economy grew 7.4 percent in 2014, the slowest rate for 24 years, slightly below its 7.5 percent growth target. The government lowered its target to 7 percent for 2015.