Fed Reverse Repo Facility Balances Sink Below $100 Billion (1)

The amount of money investors park at a major Federal Reserve facility dropped below $100 billion for the first time since 2021 after policymakers adjusted the parameters this week.

Some 40 participants on Friday put a combined $98.4 billion at the Fed’s overnight reverse repurchase agreement facility, known as the RRP, which is used by banks, government-sponsored enterprises and money-market mutual funds to earn interest. It marks a steep decline from a record $2.55 trillion stashed on Dec. 30, 2022, according to New York Fed data.

The latest decline in usage comes after officials on Wednesday lowered the rate on ...