Funding stress flares as U.S. banks lean on Fed’s repo safety valve
Banks turn to Fed repo line as liquidity tightens, signaling potential strain in money markets.
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2 days agoFunding stress flares as U.S. banks lean on Fed’s repo safety valve
U.S. banks borrowed $6.5 billion from the Fed’s Standing Repo Facility, marking the largest daily usage outside quarter-end periods since the pandemic. Concurrently, general collateral repo rates climbed to 4.36%, reflecting tightening funding conditions. The move follows large Treasury settlements of $40B, which drain bank reserves. Some analysts view this as stress in U.S. money markets, and warn Fed tightening and debt issuance may push liquidity constrained further. Officials are watching whether this signifies broader pressure on short-term funding markets.
negative
2 days agoFunding stress flares as U.S. banks lean on Fed’s repo safety valve
U.S. banks borrowed $6.5 billion from the Fed’s Standing Repo Facility, marking the largest daily usage outside quarter-end periods since the pandemic. Concurrently, general collateral repo rates climbed to 4.36%, reflecting tightening funding conditions. The move follows large Treasury settlements of $40B, which drain bank reserves. Some analysts view this as stress in U.S. money markets, and warn Fed tightening and debt issuance may push liquidity constrained further. Officials are watching whether this signifies broader pressure on short-term funding markets.
negative
Funding stress flares as U.S. banks lean on Fed’s repo safety valve
3 days ago
1 min read
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Banks turn to Fed repo line as liquidity tightens, signaling potential strain in money markets.
U.S. banks borrowed $6.5 billion from the Fed’s Standing Repo Facility, marking the largest daily usage outside quarter-end periods since the pandemic. Concurrently, general collateral repo rates climbed to 4.36%, reflecting tightening funding conditions. The move follows large Treasury settlements of $40B, which drain bank reserves. Some analysts view this as stress in U.S. money markets, and warn Fed tightening and debt issuance may push liquidity constrained further. Officials are watching whether this signifies broader pressure on short-term funding markets.
U.S. banks borrowed $6.5 billion from the Fed’s Standing Repo Facility, marking the largest daily usage outside quarter-end periods since the pandemic. Concurrently, general collateral repo rates climbed to 4.36%, reflecting tightening funding conditions. The move follows large Treasury settlements of $40B, which drain bank reserves. Some analysts view this as stress in U.S. money markets, and warn Fed tightening and debt issuance may push liquidity constrained further. Officials are watching whether this signifies broader pressure on short-term funding markets.
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Fed
liquidity
Fed
liquidity
finance
US markets
Source:
Oct 16, 2025 • 21:27 IST