The Federal Reserve (Fed) is experiencing significant financial losses, with a reported $114 billion loss in 2023, marking its largest loss in history. This loss is attributed to the decline in Reverse Repo cash on deposit at the Fed, which has been funding the deficit. As a result, the Fed's traditional profits paid to the US Treasury have ceased, impacting deficit reduction. The Reverse Repo operation at the Fed reached $583 billion, indicating ongoing liquidity challenges in the UST market. Additionally, the China Central Bank injected 547 billion yuan via 7-day reverse repos at 1.80%, as part of its monetary policy measures.
⚠️ COLUMN-FOCUS SHARPENS ON FED'S DISAPPEARING REVERSE REPO: MCGEEVER (Reuters) As the amount of cash parked at the Federal Reserve's overnight reverse repo facility (ON RRP) hurtles towards zero, the Fed's visibility on the minimum level of bank reserves needed to ensure the… https://t.co/7lU9RwJ1zP
🔴 CHINA CENTRAL BANK INJECTS 547 BILLION YUAN VIA 7-DAY REVERSE REPOS AT 1.80%: STATEMENT
reverse repo at $583b today. https://t.co/HU7Iukkf3P
🔴 65 COUNTERPARTIES TAKE $583.103 BLN AT THE FED REVERSE REPO OPERATION.
The Fed used to pay it's profits to the US Treasury each year. That was normally in the tens of billions of $$$ and it helped reduce the deficit a bit. But starting in 2022 the Fed began losing money. For all of 2023, the losses were $114 billion. Why? Because the Fed is… https://t.co/FWz3nTmbUf
Fed reports its largest loss in history: $114 billion in a single year. That would be the third largest bankruptcy in American history. And there's still another trillion plus in "unrealized" losses. Who'll pay for it? You. And your children. https://t.co/xKfKWDcG4K
We have been saying for weeks: watch the evaporating Reverse Repo cash on deposit at the Fed which is funding the deficit. As it falls and liquidity in the UST market also falls, the next step is the end of Fed QT. https://t.co/td6m6dhfQD
🇨🇳 With 779 billion yuan worth of MLF loans set to expire this month, the operation on Monday resulted in a net 216 billion yuan fresh fund injection into the banking system. The central bank also injected 89 billion yuan through seven-day reverse repos while keeping borrowing… https://t.co/qVgHnswRtW