EPISODE · Jul 24, 2026 · 8 MIN
Why Central Banks Are Watching the Reverse Repo Facility
from Monetary Policy Explained with Fexingo: Central Banks, Money Supply, and Interest Rates · host Fexingo
Episode 130 of Monetary Policy Explained with Fexingo. Lucas and Luna dive into the Federal Reserve's overnight reverse repo facility — a once-obscure tool that has become a key indicator of liquidity in the financial system. They explain how the facility works, why its usage surged to over $2 trillion in 2021 and then collapsed to near zero by 2024, and what that reversal signals about bank reserves, money market funds, and the Fed's balance-sheet runoff. Using concrete data from the New York Fed, the hosts connect the reverse repo facility to broader questions about quantitative tightening and the plumbing of short-term funding markets. No jargon without explanation — just clear, focused analysis of one specific central-bank tool and what it tells us right now. #ReverseRepo #FederalReserve #QuantitativeTightening #MoneyMarketFunds #BankReserves #Liquidity #MonetaryPolicy #CentralBanking #OvernightRepo #NewYorkFed #FedBalanceSheet #TreasuryGeneralAccount #RepoMarket #MoneySupply #Economics #FexingoBusiness #BusinessPodcast #MarketStructure Keep every episode free: buymeacoffee.com/fexingo
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Why Central Banks Are Watching the Reverse Repo Facility
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