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Macro

Fed overnight reverse repo usage holds at $200M with single counterparty

The Federal Reserve’s overnight reverse repurchase agreement (RRP) facility recorded $200 million in usage on Monday, October 26, with one counterparty, unchanged from the previous trading day’s $200 million. The minimal take-up underscores how few market participants are parking cash at the central bank’s facility.

Original source

AI take

The near-empty RRP is a quiet but telling signal about the plumbing of dollar liquidity: with so few counterparties bothering to park cash at the Fed, the facility has effectively stopped functioning as a daily outlet for excess reserves. That matters less for headline rates than for what it reveals about where cash is instead sitting — presumably in bills, repo or other short-term instruments offering a spread over the Fed's rate. The open question is whether this minimal take-up persists as Treasury supply and reserve levels shift, since persistent single-counterparty usage makes the facility look more like a residual backstop than a policy tool.

Generated by AI for reference only.

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