MW - FOMC repos.....
Sorry for the delayed response. Been out of town on business the past couple of days. Only stopped at home to change before going out and chasing some city skirt tonight (the problem is catching that damn skirt!)
I show a $20 billion O/W repo, which represented a net addition of $12 billion. This is substantially more than the Fed typically adds, and was apparently intended to ensure sufficient liquidity in light of disruptions associated with the electricity power failure in parts of the eastern U.S. and Canada. Whenever there is some instability or market event the Fed pours excess money into the system to make sure there are no liquidity problems. That $20 billion is evidence they are doing it again. Expect it to flow back out next week.
http://app.ny.frb.org/dmm/mkt.cfm
Additionally, U.S. Treasury Department data for June showed huge overseas purchases of Treasury and other securities. Overseas accounts bought $44.1 billion Treasuries, $7.2 billion Agencies, $23 billion corporate bonds, and $10.3 billion stocks. By country, by far the biggest buying was from Japan at +$11.9 billion. The U.K. added $9.6 billion.
It will be intersting to see how long they hold this paper when interest rates begin to climb.
Think I'll do some jet skiing this weekend:
Regards,
Naz
Sorry for the delayed response. Been out of town on business the past couple of days. Only stopped at home to change before going out and chasing some city skirt tonight (the problem is catching that damn skirt!)
I show a $20 billion O/W repo, which represented a net addition of $12 billion. This is substantially more than the Fed typically adds, and was apparently intended to ensure sufficient liquidity in light of disruptions associated with the electricity power failure in parts of the eastern U.S. and Canada. Whenever there is some instability or market event the Fed pours excess money into the system to make sure there are no liquidity problems. That $20 billion is evidence they are doing it again. Expect it to flow back out next week.
http://app.ny.frb.org/dmm/mkt.cfm
Additionally, U.S. Treasury Department data for June showed huge overseas purchases of Treasury and other securities. Overseas accounts bought $44.1 billion Treasuries, $7.2 billion Agencies, $23 billion corporate bonds, and $10.3 billion stocks. By country, by far the biggest buying was from Japan at +$11.9 billion. The U.K. added $9.6 billion.
It will be intersting to see how long they hold this paper when interest rates begin to climb.
Think I'll do some jet skiing this weekend:
Regards,
Naz
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