Fed Adds $58.15 Billion in Liquidity on Monday

Date : 10/21/2019 @ 2:37PM
Source : Dow Jones News

Fed Adds $58.15 Billion in Liquidity on Monday

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)

Copyright (c) 2019 Dow Jones & Company, Inc.


Your Recent History
LSE
GKP
Gulf Keyst..
LSE
QPP
Quindell
FTSE
UKX
FTSE 100
LSE
IOF
Iofina
FX
GBPUSD
UK Sterlin..
Stocks you've viewed will appear in this box, letting you easily return to quotes you've seen previously.

Register now to create your own custom streaming stock watchlist.


NYSE, AMEX, and ASX quotes are delayed by at least 20 minutes.
All other quotes are delayed by at least 15 minutes unless otherwise stated.