Fed funds closed at 0.1 percent yesterday after trading from 0.05 percent to 0.3125 percent and averaging 0.09 percent, ICAP Plc, the world’s largest inter-dealer broker, said in an e- mailed statement.
The Federal Reserve Bank of New York will begin a series of “small-scale” reverse repurchase agreements as it prepares one of the tools for the eventual withdrawal of monetary stimulus. The operations, part of a series first announced in 2009, don’t represent any change in monetary policy, the New York Fed said yesterday in a statement on its website.
The central bank will also acquire $1.5 billion to $2 billion of Treasuries maturing from May 2036 to February 2042. The purchases are part of the Fed’s program to replace $400 billion of short-term debt in its portfolio with longer-term Treasuries in an effort to reduce borrowing costs further and counter rising risks of a recession.
The New York Fed will also release its monthly schedule for its Treasury purchases and sales as part of its maturity extension program. The announcement is schedule for 2 p.m. New York time.
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