The Federal Reserve is being urged to take more aggressive action to address short-term funding market pressure
BlockBeats News, November 13th, in the $12 trillion global bond market that serves as a key source of daily funding for Wall Street, the mounting pressure is increasingly triggering calls for the Federal Reserve to take stronger actions to alleviate the pressure. Companies, including Bank of America and Barclays, have warned that the Fed may need to take actions such as increasing lending in the short-term market or directly purchasing securities to inject funds into the banking system and relieve the pressure driving up overnight rates.
Gennadiy Goldberg, the head of rate strategy at TD Securities, said, "Given the recent pressures, the Fed appears to be only gradually changing its balance sheet policy. Some investors believe the Fed's actions may be too slow to prevent reserves from becoming scarce." Despite the Fed's recent announcement to halt the reduction of its U.S. Treasury holdings on December 1st, the pressure persists, with some concerned that the end of the government stalemate may not fully resolve the issue. (FXStreet)
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