Earlier this month, I asked a former luminary of US monetary policy if he thought interest rates in America might ever tumble into negative territory by design (as a deliberate Federal Reserve policy move rather than the result of a market swing).

“No!” he replied emphatically, explaining that he, and most of his former colleagues, strongly disliked the idea of negative interest rates, never mind the fact that Europe and Japan have been experimenting with them for some time (and President Donald Trump would probably love the Fed to follow suit).

This is partly, he explained, because he fears that negative rates can distort markets. As the Bank for International Settlements, the central banks’ bank, pointed out in a report this week, the use of unconventional monetary policy runs the risk “of eroding incentives for the private sector to maintain adequate buffers against financial stress”. But there is also another factor in play: psychology.