China panic has abated. The Shanghai Composite index of equities is back above 3,000. The much-feared devaluation never happened.

The yuan has strengthened against the dollar this year, to the consternation of Western macro-tourists. Outflows of money have slowed as dollar debt is paid off and Chinese investors wind down 'carry trade' positions.

The central bank (PBOC) is no longer depleting the country's $3.2 trillion foreign reserves to defend the exchange rate, and thereby tightening monetary policy as a nasty side-effect. China has the apparatus of an authoritarian state to curb capital flight, and is not shy about using it.

The International Monetary Fund has just raised its forecast for Chinese growth this year to 6.5pc, insisting that it is still far too early to talk about a hard-landing.

Yet that is where the good news ends, for there is a poisonous sting in the tail.

Maurice Obstfeld, the IMF's chief economist, said the trade-off for this year's growth spurt is even more trouble down the road. "While we have upgraded near-term projections, we have downgraded the farther out projections," he said.

"Our concern is some of the stimulus is likely to take the form of higher credit growth, more support for sectors that are in a secular sense declining and not that productive. We worry about the quality of growth more than the quantity of growth," he said.