Fed’s Repo Backstop Gets Most Use Since 2020

From bnnbloomberg.ca

Demand for a rarely used Federal Reserve facility rose to the highest level since 2020 this week, potentially signaling that one or more banks are making preparations for future liquidity strains as the central bank’s balance-sheet unwind deepens. Counterparties tapped the Fed’s Standing Repo Facility, or SRF — where eligible banks can borrow reserves in exchange for Treasury and agency debt — for $203 million on Dec. 5. That’s the most since July 2020, but it’s a miniscule amount for a facility that at its peak attracted $153 billion in March 2020. Demand for the facility dropped back to $6 million ... (full story)