Borrowing from the Federal Reserve’s backstop liquidity facilities were little changed last week, even as strains in the banking sector remain in focus.
(Bloomberg) — Borrowing from the Federal Reserve’s backstop liquidity facilities were little changed last week, even as strains in the banking sector remain in focus.
The US central bank had $96.1 billion of loans outstanding to financial institutions through two backstop lending facilities in the week through May 24, virtually unchanged from the previous week, according to data published Thursday.
The weekly Fed balance-sheet data showed $4.2 billion of outstanding borrowing from the central bank’s traditional backstop lending program, known as the discount window, compared with $9 billion the previous week. Demand in the new Bank Term Funding Program rose to $91.9 billion compared with $87 billion the previous week.
Policymakers have expressed concern about the impact of bank turmoil on lending activity and the broader economy, though they have also suggested the worst of the stresses on individual institutions may be over.
The discount window is the Fed’s oldest liquidity backstop for banks. The BTFP, meanwhile, was launched March 12 after the Fed declared emergency conditions following the collapse of California’s Silicon Valley Bank and New York’s Signature Bank.
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