The goal of the monetary policy of the People's Bank of China is to ensure the stability of the currency. If the People's Bank of China issues loans to the government, the government will have no other income except fiscal revenue. The government can't repay bank loans by increasing taxes, but can only use government power to suppress banks from hedging loans with excess currency, which leads to currency depreciation and inflation. In order to keep the currency stable, the People's Bank of China stipulates that the People's Bank of China cannot provide loans to the government and government departments. Law of the People's Republic of China on the People's Bank of China Article 30 The People's Bank of China shall not provide loans to local governments and government departments at all levels, and shall not provide loans to non-bank financial institutions and other units and individuals, unless the State Council decides that the People's Bank of China may provide loans to specific non-bank financial institutions. The People's Bank of China shall not provide guarantee to any unit or individual.