Demand for Fed’s Bank Term Funding Facility Grows to Record High
- Use rose to all-time high $131 billion in week through Dec. 20
- Facility pricing more attractive as rate-cut bets increase
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Banks borrowed a record amount from the Federal Reserve’s newest backstop facility in the most recent week as increasing wagers on interest-rate cuts made it a more attractive choice.
Data from the Fed showed an all-time high $131 billion in borrowing from the Bank Term Funding Program, or BTFP, in the week through Dec. 20. That compares to a previous record of $124 billion, reached in the week ended Dec. 13.