Update: confirming that liquidity is indeed quite scarce to start the month of February, moments ago the Fed also conducted its overnight repo which saw $37.915BN in liquidity injected...
... and which together with the oversubscribed $30BN term repo discussed below, means the Fed has injected $68BN in liquidity for today's market needs.
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The repo market was supposed to be fixed in September; then the year-end liquidity flood was supposed to definitely fix the repo market. Well, it is now mid-February and moments ago the Fed just reported it conducted the third oversubscribed term-repo operation as the liquidity shortage among dealers appears to persist!
Dealers submitted $40.4BN in Treasurys (at a 1.58% stop out) and $13.25BN in MBS (at a 1.60% stop out) for a total of $53.65 of which $30BN was accepted.
This means that for the third consecutive operation, demand for the Fed's repo was oversubscribed at a rate not seen since the start of the repo crisis.
Ominously, the ongoing substantial overdemand for term repo (which in February was cut by $5BN from $35BN to $30BN) means that the liquidity crisis that continues to percolate just below the surface of the market and has clogged up the critical plumbing within the US financial system, is getting worse, not better, and today's massive oversubscription indicates that one or more entities continues to face a dire shortage of reserves, i.e., cash.