Funding and Collateral Solutions

Centrally Cleared Repo Market Brief

A quarterly update on the developments in the centrally cleared sponsored repo market

October 2021

Through innovative and flexible cash investment and financing solutions, we provide both our custody and third-party clients access to the Fixed Income Clearing Corporation (FICC) sponsored repo platform.

Given the interconnectivity between repo markets, monetary policy and macroeconomic trends, we want to help you stay up to date on what’s happening in the market with a specific focus on the rapidly growing sponsored segment. With views on recent market trends and what to expect in the future, our quarterly briefs give you the insight you need to unlock the benefits of centrally cleared repo.


Highlights from this quarter:

•    Growth in FICC Sponsored cash provider balance was limited in Q3 due to the continued rise in usage at the Fed’s Reverse Repo Facility (RRP)
•    Dwindling T-Bill supply, treasury general account balances, and bank capital constraints led to $1.6 trillion in cash getting parked at the RRP over quarter end
•    The Fed doubled counterparty limits to $160 billion at the RRP which could help strengthen the repo rate floor
•    Moving forward all eyes are on the Fed for the timeline of their eventual taper in $120 billion of monthly asset purchases and how this effects the market