With a sharp cyclical rebound in 2017 and ahead of the 19th Party Congress, Xi Jinping’s government initiated assertive financial regulation, as well as greater party control over the operational management of enterprises and the lives of citizens. Concerns about the economy and rising debt were elbowed aside, but as the intensive policy-driven factors behind the upturn fade, the economy, and the next policy shift, will come back into sharper focus.

To appreciate the new prioritising of financial risk, consider that by 2017, financial assets and liabilities had grown fourfold over a decade to more than 420tn renminbi ($66tn), or from 310 to more than 510 per cent of gross domestic product, which had, itself, risen 2.5 times. Rapid credit expansion was driven by public policy and weak regulation, which spawned widespread interest rate and regulatory arbitrage, the eruption of risky asset management products, a surge in non-traditional lending and wholesale deposit-taking by shadow banks, and extensive internet-enabled finance and lending.

Cognisant of the dangers to financial stability, Mr Xi took personal responsibility last year to improve regulatory co-operation, stamp on risky financial products and practices and punish the worst risk taking. The establishment of a Financial Stability and Development Committee, whose next head may be Liu He, new politburo member, reformer and a close adviser of Mr Xi, has aroused interest.