TREE NEWS reports: The secured overnight financing rate (SOFR) rose to 3.90% on Oct. 22 from 3.88% the prior day. The effective federal funds rate held at 3.88% for the same trading day, unchanged from the previous session. The two benchmarks now sit at a 2-basis-point spread.
SOFR rises to 3.90% on Oct. 22; fed funds rate holds at 3.88%
AI take
The two-basis-point gap between SOFR and the effective fed funds rate is the detail worth flagging: secured overnight funding is now pricing slightly above unsecured bank funding, a configuration that can signal tightening collateral conditions rather than a policy shift. With the fed funds rate unchanged, this looks like a money-market plumbing move, not a rate-path signal. Whether the spread stays positive or reverts is the open question, and it matters most for repo-dependent players watching collateral scarcity.
Generated by AI for reference only.
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