PhyrexNi
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According to data released by the Federal Reserve, the effective federal funds rate in the United States was 4.33% on April 1, with a transaction volume of $112 billion, while on March 31 it was also 4.33%, with a transaction volume of $78 billion.
This indicates that after entering April, the market's expectations for the federal funds rate remained stable, with no significant changes or signs of panic. The current short-term liquidity situation is stable, and there are no signs of special funding tightness or loosening.
The overnight borrowing volume between market participants increased by 43%, which may represent liquidity adjustments at the beginning of the quarter (with Q2 starting), as institutions adjust positions, settle, or deploy funds. However, since the interest rate remained unchanged, the increased liquidity did not push up short-term financing costs, indicating that the market remains ample.
Under the premise of unchanged interest rates, the trading activity in the federal funds market has increased, with a phase of rising market liquidity demand, but overall it remains robust, with no interest rate pressure.
In simpler terms, the liquidity of the dollar has not further tightened, and there is a rising trend in market demand for funds. If funds were indeed tight, the EFFR (effective federal funds rate) should have risen, rather than remaining at 4.33%.
In other words, funds are currently being positioned, not withdrawn.
This indicates that after entering April, the market's expectations for the federal funds rate remained stable, with no significant changes or signs of panic. The current short-term liquidity situation is stable, and there are no signs of special funding tightness or loosening.
The overnight borrowing volume between market participants increased by 43%, which may represent liquidity adjustments at the beginning of the quarter (with Q2 starting), as institutions adjust positions, settle, or deploy funds. However, since the interest rate remained unchanged, the increased liquidity did not push up short-term financing costs, indicating that the market remains ample.
Under the premise of unchanged interest rates, the trading activity in the federal funds market has increased, with a phase of rising market liquidity demand, but overall it remains robust, with no interest rate pressure.
In simpler terms, the liquidity of the dollar has not further tightened, and there is a rising trend in market demand for funds. If funds were indeed tight, the EFFR (effective federal funds rate) should have risen, rather than remaining at 4.33%.
In other words, funds are currently being positioned, not withdrawn.
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