The Federal Reserve building in Washington

The Federal Reserve building in Washington, D.C., U.S., September 16, 2025. REUTERS/Aaron Schwartz/File Photo Purchase Licensing Rights, opens new tab

NEW YORK, Oct 29 (Reuters) - The Federal Reserve's Standing Repo Facility on Wednesday recorded the highest level of usage since its launch in 2021, as central bankers are widely expected to announce an end to their balance sheet drawdown.

Eligible financial firms took slightly over $10 billion in loans from the facility, widely known as the SRF.

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Collateralizing that borrowing was $2 billion in Treasury bonds and $8.2 billion in mortgage-backed securities. Despite the record borrowings, SRF volume remains very small relative to the roughly $1 trillion per day in the tri-party general collateral repo borrowing sector, for example.

The SRF was created to provide fast liquidity for firms, provide a shock absorber for the market, and allow the Fed to refrain from traditional interventions. SRF usage has been ticking higher since mid-month amid a broader rise in money market rates.

The updraft in money market rates includes a drift higher in the federal funds rate, the central bank's chief tool to influence the economy. Other money market rates have also risen.