The Growing Threat of a Banking Risk

Undoubtedly, China is one of the most complex economies in the world; understanding it requires not only patience, but also humility when arriving at nineteenth-century conclusions. During the last quarter of 2016 and the first quarter of 2016, changes in the economy of the Asian giant have been dual: Consumption per capita and industrial activity have been increasing—particularly in this last quarter. Yet the financial sector is beginning to experience liquidity tensions in the short-term and greater regulatory pressures that can constrain the refinancing of products offered by shadow banking, the great majority of which are linked to an inseparable maturity mismatch.