Fed Meeting and the Repo Rate

The FOMC meeting is next week and the Fed Funds Futures are showing no chance of a rate cut, but the Repo rate remains far below the target rate for Fed Funds:



Banks pay 5% to borrow from the Fed if they have treasuries to use as collateral. They pay about 0.25% more if they use Agency or other mortgage backed securities.

Edited 2 time(s). Last edit at 06/22/2007 09:43PM by RodgerRafter.

I did not know that is how it worked. Interesting.