The Wall Street Journal writes, "Demand For Fed'​s Repo Program Surges, Aided By Money-​Market Fund Rules." It says, "The Federal Reserve Bank of New York is seeing earlier than normal demand for its overnight "​repo" facility in part thanks to new rules impacting money-​market funds, indirectly lifting a key measure of short-​term borrowing costs on Wall Street. The rush to put money in the repo program, which the Fed designed to soak up excess cash in money markets and help the central bank control interest rates, is sucking cash from the private market for the overnight loans known formally as repurchase agreements." The WSJ piece adds, "The Fed'​s facility is a boon to money-​market funds, many of whom are choosing to convert to holding government only securities in advance of new rules taking effect October 14. The Fed facility helps them because it pays participants interest on their cash and gives them U.​S. Treasury bonds as collateral overnight out of the Fed'​s portfolio. Demand for the program also comes as banks are reining in their activities around month- and quarter-​end dates to make their balance sheet snapshots appear safer under post-​crisis regulations. The Fed'​s overnight repo program on Wednesday, two days before quarter end, took in $​272 billion from banks and money-​market funds eligible to trade with the New York Fed, its seventh highest volume since the Fed began testing it in 2013."

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