Panellists warm to Treasury plan to lend TGA cash in repo
Goldman’s Chambers backs the idea, while JP Morgan and BNY execs say payoff depends on repo trading above IORB
Market participants have given a cautious welcome to a US Treasury proposal to lend excess cash into the overnight Treasury repo market, arguing that it could dampen funding spikes – though they note the economics only work when repo rates trade above what the Federal Reserve pays on bank reserves.
“It makes sense from a debt sustainability standpoint to have the largest issuer in the world step in
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