Telegram
Fed Returns to Repo Mkt; Says Might Expand Balance Sheet

In a week in which the Federal Reserve’s Federal Open Market Committee delivered a rate reduction to the Fed funds rate, it wasn’t even the biggest news. Not by a long shot. That was about as expected as anything can get in financial markets.

Instead, what had investors’ attention was a money markets operation by the Fed that was a surprise and hadn’t been done since the financial crisis of 2008-09. From Tuesday through Friday the Fed injected about $75 billion of daily liquidity through repo operations, in order to stabilize short term money markets. The rate to borrow cash overnight using Treasury securities as collateral surged Tuesday to as high as 10% as the amount of cash available to lend was exceeded by the demand to borrow it.

You are trying to access FSI member-only content.
You need to have an active FSI Macro, or FSI Pro subcription in order to read this article.
If you are already a member at FS Insight, please Sign In here. If you don’t have a subscription to FS Insight yet, you can sign up below.

Choose one of our yearly plans to save nearly 20%

We accept crypto via BitPay for yearly subscriptions.
    • Macro
      FSI Macro
      from
      $
      199
      /mo
      billed anually
      Get access to all the macro research on FS Insight
      • Tom Lee's Live Market BLASTs
      • View from Tom Lee
      • Signal From Noise
      • Portfolio Strategy
      • Technical Analysis
      • Granny Shots – Stock Ideas
      • US Policy
      • Live Conference Calls with Q&A
      First Month Free!
    • Crypto
      FSI Digital Assets
      from
      $
      99
      /mo
      billed anually
      Get access to all the crypto research on FS Insight
      • Tom Lee's Live Crypto BLASTs
      • Tom's Take on Crypto
      • Crypto Weekly Newsletter
      • BitDigest Daily Newsletter
      • Crypto Technical Analysis
      • Benchmark Indices Review
      • Bitcoin Valuation & Misery Indexes
      • Live Conference Calls with Q&A
      First Month Free!
    • Macro + Crypto
      FSI Pro
      from
      $
      249
      /mo
      billed anually
      Get access to all the exclusive research on FS Insight
      • Looking at code?
      • I am hidden!
      • FSI Macro
      • +
      • FSI Digital Assets
      • Designed by
      • HANGAR115
      • -
      First Month Free!
Disclosures (show)

Want to receive Regular Market Updates to your Inbox?

I am your default error :)