The Chinese and US monetary authorities provide the best example of the “Stockholm syndrome” applied to international financial affairs. Cloying dependence between hostages and hostage-takers in drawn-out abductions describes the symbiotic bonds between the world's biggest debtor, the US Treasury, and the largest creditor, the People's Bank of China.

Chinese leaders frequently emphasise America's responsibilities for the stability of the dollar as the premier reserve currency. The Chinese central bank, the guardian of the proceeds from Beijing's massive current account surpluses, warns obliquely that turning its back on the greenback would risk a monetary catastrophe. It is time, though, for a more balanced debate. To enhance its credibility, Beijing must put its own house in order. In the interests of a more stable monetary system, China needs to open its capital markets and allow broader international access to the renminbi. The US and its allies should insist on this unrelentingly.

China's finely calibrated warnings about a significant move from the dollar are unlikely to be enacted. About 70 per cent of Chinese reserves of more than $2,000bn (€1,395bn, ￡1,220bn) are thought to be held in the greenback. Who holds whom hostage? Heavy Beijing dollar sales would hurt its interests as much as America's.