Fed announces a series of measures to improve liquidity

The US Central Bank on Friday announced a series of measures to improve liquidity and better manage its interest rates, stressing that it was in no way a "change in monetary policy."

These measures will consist of buying Treasury bills of up to $ 60 billion per month at least until the second quarter of 2020 while pursuing "repo" operations (repurchase of repos) at least until the end of the year. January 2020, says the Fed in a statement.

Monthly Treasury bill purchases will start in mid-October for the mid-October / mid-November period, the Fed adds, adding that the $ 60 billion is an "initial" amount.

Regarding Repo operations, the Fed announces both bi-weekly operations "of at least $ 35 billion per transaction" and a daily operation "initially at least up to $ 75 billion per transaction."

These measures follow the difficulties encountered in September in the day-to-day interbank market, which had pushed interest rates on this source of short-term liquidity to levels well above the bank's key interest rate. the Fed, between 1.75 and 2%.

Last week, the Federal Reserve of New York (Fed) had announced that it would extend until November 4 its daily financial injections of $ 75 billion in the interbank market.

The timing and amounts of Treasury bill purchases and Repo transactions will be adjusted as needed "to maintain a sufficient reserve of cash over time and according to money market conditions," the Fed finally said Friday .