SOFR rises to 3.93%, spread over Fed IORB widest since August

The SOFR–IORB spread widening back to its August high is a reminder that quarter-end and fiscal-year settlement flows, not policy signals, are driving short-term funding costs. The pressure here traces to Treasury auction settlements and Canadian bank year-end, which are transient plumbing events rather than a shift in the Fed's stance, and the unchanged effective fed funds rate reinforces that read. For repo and short-rate markets, the question worth watching is whether this funding tightness fades as settlements clear or persists into a broader balance-sheet constraint.