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Wrightson ICAP: Minutes Could Provide Insight On Standing Repo Decision

FED

Wrightson ICAP will be looking to the July FOMC meeting minutes out Wednesday for insight into why the Fed chose "this particular moment" to take existing repo facilities and "rebrand them as a limited-purpose standing repo facility".

  • Wrightson ICAP are interested in the timing of the decision, why the facilities are relatively narrow in scope (at least to begin with), and various aspects concerning the Fed's thinking on how the SRF will impact demand for reserves and other outcomes.
  • "We'll be interested to see whether the minutes suggest that the FOMC sees the SRF discussion as a work in progress, or whether a significant number of committee members view the "new" facilities as a logical stopping point for now."
  • MNI published an exclusive today with sources addressing some of those themes, including why the Fed's establishment of permanent standing repo is likely just a "first step", with changes to the operating regime eyed in the relatively near future.

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