Central Banking

High demand for longer-term Fed funding

The results of the Federal Reserve's first Term Auction Facility (TAF) operation to offer 84-day credit highlight the banking sector's demand for longer-term financing.

The results of the Tuesday auction show that banks paid a minimum of 2.754% for the 84-day loans, more than 75 basis points higher than the federal funds rate and less than five basis points below the London Interbank Offered Rate (Libor) for three-month interbank dollar loan of 2.80375%. The bid-to-cover ratio, which records

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