The US Dollar has finally started to react more to these repo announcements (DOllar Index at 5 month lows) and the Fed’s official balance sheet increasing billion in one week, billion dollars in only 3 weeks and the Fed’s official balance sheet is now up 5.5 billion dollars since the end of August 2019.
Track the Fed’s official balance sheet here: https://fred.stlouisfed.org/series/WALCL
Today, the NY Fed announced even more repo programs: https://www.newyorkfed.org/markets/opolicy/operating_policy_191212
Looks like Jim Bianco was dead on with his prediction about Repo Madness from less than 2 weeks ago.
A few days ago, Jerome Powell gave his last press conference for 2019 and said how the Fed was prepared to backstop repo in unlimited amounts: Fed ‘prepared to adjust’ balance sheet to prevent repo market flare-up https://finance.yahoo.com/news/federal-reserve-hopes-to-steer-clear-of-repo-market-flare-up-121019679.html
Claudio Borio from the Bank of International Settlements (BIS) talks about the repo market and how FX currency swaps (forward dollar swaps) are now larger off balance sheet than the trillion on balance sheet for non-financial institutions outside the US: https://www.bloomberg.com/amp/news/articles/2019-12-08/repo-blowup-was-fueled-by-big-banks-and-hedge-funds-bis-says
“Massive… Huge… Largest Ever”: Fed Will Flood Market With Gargantuan 0 Billion In Liquidity To Avoid Year-End Repo Crisis https://www.zerohedge.com/markets/avoid-repo-crisis-fed-will-flood-market-gargantuan-365-billion-year-end-liquidity
Repocalypse 2.0 On Deck? “Turn” Repo Rates Are Blowing Out https://www.zerohedge.com/markets/repocalypse-20-deck-turn-repo-rates-are-blowing-out
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