💰 The Fed is injecting liquidity into banks
🔴 The Fed conducted a large one-day repo operation: banks received $13.5 billion secured by collateral. This is the second largest liquidity injection since 2020.
🔴 A repo is not money printing nor a permanent balance sheet expansion. It is a technical one-day loan that is repaid the next day.
🔴 But the very fact indicates stress in bank funding, and the Fed is easing it with liquidity.
🔴 In recent days, the regulator has injected a total of $125 billion, which already looks like an early shift from tight QT to a softer regime.
