The Federal Reserve Bank of New York published a new "Statement Regarding Term Reverse Repurchase Agreements," which extended the Fed's Term repo programs at quarter-ends through Jan. 29, 2016. The statement says, "The Open Market Trading Desk (the Desk) at the Federal Reserve Bank of New York has been working internally and with market participants on operational aspects of tri-party reverse repurchase agreements (RRPs) to ensure that this tool will be ready to support the monetary policy objectives of the Federal Open Market Committee (FOMC). The Federal Reserve continues to enhance operational readiness and increase its understanding of the impact of RRPs through technical exercises. In further support of its objectives, the FOMC instructed the Desk to examine how term RRP operations might work as an additional supplementary tool to help control the federal funds rate. In support of this goal, on March 17, 2015, the FOMC approved a resolution authorizing the Desk to conduct a series of term RRP operations to span each quarter-end through January 29, 2016. For the June quarter-end, the Desk plans to offer at least $200 billion in term reverse repurchase agreement transactions that cross the quarter-end date. These operations will be conducted in addition to the authorized overnight RRPs, which remain subject to a separate overall size limit authorized by the FOMC [currently $300 billion]. A tentative schedule of the term operations spanning the June quarter-end follows below. This schedule will be updated on or around June 22 with additional information, including the amounts offered and the maximum offering rates." The first Operation/Settlement Date is June 25 with a Maturity Date of July 2. The next Operation/Settlement Date is June 29 with a Maturity Date of July 1. It continues, "Each of these operations will be conducted from 9:30 a.m. to 10:00 a.m. (ET), and each bidder will be limited to two bids per operation." In other news, the Federal Reserve also released the Minutes from the April 28-29 FOMC meeting. It says, "The Open Market Desk conducted two term RRP operations over the March quarter-end. The combination of term and ON RRP operations continued to provide a soft floor for money market rates over the intermeeting period, including around quarter-end. Based on experience around recent quarter-ends, the deputy manager discussed possible plans for June test RRP operations." It adds, "Many participants, however, thought it unlikely that the data available in June would provide sufficient confirmation that the conditions for raising the target range for the federal funds rate had been satisfied, although they generally did not rule out this possibility. Participants discussed the merits of providing an explicit indication, in post-meeting statements released prior to the commencement of policy firming, that the target range for the federal funds rate would likely be raised in the near term. However, most participants felt that the timing of the first increase in the target range for the federal funds rate would appropriately be determined on a meeting-by-meeting basis and would depend on the evolution of economic conditions and the outlook."
