The Federal Reserve injects additional $500 billion into the repo operation markets! The Federal Reserve injects additional $500 billion amidst growing funding pressures. New York’s trading desk of the Federal Reserve has been trying to minimize disruptions in the overnight funding markets where banks go to get operating capital.
This latest move comes on top of the $1.5 trillion dollars injected last week. Repo involves banks posting high-quality collateral for reserves used to operate. The minimum bid had been 0.1%.
The repo operations follows other liquidity measures from the Federal Reserve aimed at getting banks to keep money moving throughout the economy. This latest news follows the Fed cutting its benchmark borrowing rate 150 basis points over the past few weeks.
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