Bank Reserves at Fed Fall Below $3 Trillion Amid Liquidity Drain

The US banking system’s reserves, a key factor in the Federal Reserve’s decision to keep shrinking its balance sheet, tumbled for the seventh straight week to below $3 trillion as liquidity continues to drain from the financial system.

Bank reserves fell by about $21 billion to $2,999.7 trillion in the week through Sept. 24, according to Fed data released on Thursday. That’s the lowest level since the week through Jan. 1.