Feb. 29 (Bloomberg) -- 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 0.1 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.
To contact the reporter on this story: Liz Capo McCormick in New York at email@example.com
To contact the editor responsible for this story: David Liedtka at firstname.lastname@example.org