Federal Reserve treasury operations approached $1 billion on Wednesday, as banks and other market position participants drowned in money seek a position to park their money.
The Fed’s opposite buyback facility, where currency establishments can deposit cash overnight, hit an all-time high of $992 billion on Wednesday, according to Fed data. time the installation was used a lot. In early 2021, the facility remained virtually intact.
Some observers feared that unprecedented volumes of liquidity could cause disruption to markets.
But New York Fed President John Williams assured investors last week that he was not involved at the point of buyback activity, according to Reuters. If volumes pile up even more, “it would just be a sign that it’s working as expected,” Williams said. reported saying.
The record high comes after weeks of all-time highs, when a “river overflowing with liquidity” sweeps markets. More recently, the flood came from the Fed’s ongoing asset purchases combined with a legislative requirement that the U. S. Treasury’s Treasury not be in a state of the same way. U. S. Month of July.
Since the maximum short-term investments yield virtually nothing, investors have flocked to the buyback line, which yields 0. 05%.