Washington, Nov 1. The Federal Reserve's instant liquidity mechanism approved a record volume of loans to U.S. banks on Friday amid an apparent shortage of bank balances at the end of October. The Federal Reserve's Standing Repo Facility (SRP) today lent a total of $50.35 billion to banks, the largest volume since the system was established in 2021 to provide fast credits backed by assets considered safe, such as Treasury bonds or mortgages. The injections were approved in two separate funding rounds, the first valued at $30 billion and the second at $20.35 billion, according to data released today by the Federal Reserve Bank of New York. The record volume of rapid loans comes on the last day of the month, a time when bank payments, settlements, or obligations tend to spike, and also after the Fed announced on Wednesday that it will stop withdrawing cash from markets on December 1st by ending its quantitative tightening program, designed to cool the economy.
