Fed’s Repo Backstop Tapped as Users Test Accessibility Again

A rarely used Federal Reserve facility was tapped for more than $100 million on Wednesday as counterparties continue to test its accessibility.

• Counterparty demand for the Fed’s Standing Repo Facility, or SRF — where eligible banks can borrow reserves in exchange for Treasury and agency debt — rose to $101 million on Wednesday
• That’s below the $2.6 billion counterparties demanded on Sept. 30, which was the highest level since before the daily operations were made permanent more than three years ago. However, Barclays Plc believed was unplanned and driven more by need than a desire to arbitrage market rates
  • Before ...