Fed Funds Opens at 0.12%, ICAP Says, Within Target Range

Fed funds, the U.S. overnight inter-bank lending rate, opened at 0.12 percent, within the Federal Reserve’s target of zero to 0.25 percent.

Fed funds closed at 0.10 percent yesterday after trading from 0.06 percent to 0.20 percent and averaging 0.11 percent, according to ICAP Plc, the world’s largest inter-dealer broker.

The central bank will acquire Treasury Inflation Protected Securities maturing from July 2018 to February 2041 today. The purchases are part of the Fed’s program to replace $400 billion of short-term debt in its portfolio with longer-term Treasuries to reduce borrowing costs further and counter recession risk.

The central bank plans to buy $1 billion to $1.5 billion of securities today, according to the New York Fed’s website.

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