The slowdown in the US and eurozone economies continues to surprise the Federal Reserve and the European Central Bank, explaining their recent sharp turn towards dovishness. ECB president Mario Draghi coined another of his memorable phrases last week, saying that “ pervasive uncertainty” meant downside risks, even relative to the central bank’s latest downgraded growth forecasts, were still predominant.

Policymakers in the advanced economies have uniformly attributed the downturn to “external” economic shocks, which is code for concerns about the loss of economic momentum in China. 

Towards the end of last year, these concerns seemed wholly justified. China’s GDP grew by only 6.4 per cent on the official figures in the 2018 calendar year, the lowest growth rate in three decades. According to a recent study published by  Brookings,  the true rate of growth, on more accurate data, may have been 2 percentage points below that.