Reuters writes "End of QE2 could ease repo collateral squeeze". The piece says, "Conditions in the repurchase market may remain rough until the Federal Reserve ends its Treasury purchasing program at the end of June, analysts said on Wednesday. The rates on general collateral in the repo market have been stunningly low since April 1, when a change in insurance assessment methods for commercial banks forced a flood of cash into the short-term financing markets, sucking up the collateral that comprises the other side of a repurchase agreement. Rates on the securities repo that traders use as general collateral fell to single basis-point ranges and even turned negative in cases where a particular type of security came into greater demand." The article quotes Ward McCarthy of Jefferies & Co., "The issue is what's part of the floating supply in the market. The Fed lending can help ease squeeze types of situations but that's an augment to a market that's just dry." See also, Bloomberg's "FDIC's Bair Says U.S. Money Funds 'Highly Unstable in a Crisis'".

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
November December December
October November November
September October October
August September September
July August August
June July July
May June June
April May May
March April April
February March March
January February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September