Repo rate hits 7.25% on year-end volatility
US Treasury issuance on December 31 said to have fuelled last-minute dash for cash
The cost of borrowing overnight cash in the US Treasury repo market popped 147% from the open on December 31 to an intraday high of 7.25% – an “extraordinary” move that some blame on the US government’s decision to issue $51 billion of debt on the last trading day of the year.
The general collateral (GC) repo rate closed at 4%, up 107 basis points on the day. “Forward rates a few days ahead of
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