Germany, Austria Consider Cutting Repo Cash Pile on ECB Hike
- German debt agency in talks to lend out cash for securities
- Austria’s Treasury plans to alter repo policy to cut cashpile
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Europe’s governments are exploring options to lower cash holdings as European Central Bank rate hikes will make them less attractive.
Germany’s debt agency is talking to market makers about the potential to lend out more cash in exchange for government securities, known as reverse repo deals, according to two people familiar with the matter, who declined to be named as the talks were private. An agency spokesperson confirmed this was one way to invest repo cash surpluses.