Fed Reverse Repo Usage Hits Record High After Tweak to Limits
- RRP balances rise to an all-time high of $1.35 trillion
- Doubling counterparty limit to $160 billion helps fuel demand
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The amount of money that investors are parking at a major central bank facility climbed to yet another all-time high as policy makers expanded the limit for counterparties and signaled asset purchase tapering is imminent.
Seventy-seven participants on Wednesday placed a total of $1.352 trillion at the Federal Reserve’s overnight reverse repurchase agreement facility, in which counterparties like money-market funds can place cash with the central bank. That surpassed the previous record volume of $1.28 trillion from Wednesday, New York Fed data show.