A question worth asking is: How predictable should monetary policy be? If one looks at the Federal Reserve providing direction, it is clear that rates will only go up, and the scope for conjecture is restricted to the ‘when’ of it. In fact, indications are that the quantum or rise would also be gradual — 25 bps at a time.

Economist and banking expert Allan Meltzer, at AEI yesterday: My reading of the history of financial crises is that regulators lock the door against the source of the last crisis. Neither regulators nor others can foretell how the next one will develop. They completely missed the causes of the Great Depression of 1929, the Great Recession of 2008 and much in between.

The US Treasury debates new-for-old bond swap, reports FT. The Treasury will issue more of the popular 10 year bonds, and then buy them back at some point before they mature.The idea is to make treasury markets more uniform and liquid.