Currency war?

Experts also noted that QE of the European Central Bank may bring challenges to China's monetary policy making.

"While the United States has abandoned its QE policy, but other economies such as Japan and the eurozone are pushing ahead with stimulus, and competitive devaluation of their currencies will be one result of this," Duncan Freeman, senior research fellow at Brussels Institute of Contemporary China Studies, Vrije Universiteit Brussel, told Xinhua.

"These devaluations will have a negative impact on China, and it will be a challenge to avoid becoming caught in a currency war," Freeman added.

His opinions were echoed by Tan Yalin, dean of the China Foreign Investment Research Institute.

"China will be spurred to follow suit of Europe's QE, which China's economy does not need and cannot afford to have," Tan told Xinhua.

When in a state of excessive liquidity, the theory of interest-rate cut and deposit reserve ratio reduction will not work but lead to more speculation in financial markets thus worsen the real economy, she said.

Over last weekend China cut its interest rates which was the loosening move in little more than three months. Tan said China' s recent loosening move was certainly influenced by the overseas factors indicating the QE of the EU and Japan.