By Michael S. Derby 

The Federal Reserve Bank of New York injected $58.15 billion in overnight liquidity into financial markets.

The Fed accepted $50.95 billion in Treasurys, $500 million in agencies and $6.7 billion in mortgage-backed securities.

Monday's operation by the Fed is part of an effort to help tame volatility in short-term rate markets with temporary and permanent injections of liquidity. Fed repo interventions take in Treasury and mortgage securities from eligible banks in what is effectively a loan of central bank cash, collateralized by dealer-owned bonds.

On Friday, the Fed permanently added to its holdings with $7.501 billion in Treasury bill purchases, which are aimed at growing the Fed's nearly $4 trillion in holdings. Also Friday, the Fed added $56.65 billion in short-term liquidity, which expired Monday.

Short-term rate levels weren't elevated Friday, suggesting markets weren't under any particular stress. The effective fed-funds rate stood at 1.85%, in the middle of the 1.75% to 2% range targeted by the central bank. The broad general collateral rate, which governs banks' lending of securities and cash to one another, stood at 1.85% as well, while the Secured Overnight Financing Rate was 1.88%.

Write to Michael S. Derby at michael.derby@wsj.com

(END) Dow Jones Newswires

October 21, 2019 10:22 ET (14:22 GMT)