US banks increase discount window borrowing
Federal Reserve “encouraged by the notable increase” in use of backstop facility
US banks increased their borrowing from the Federal Reserve’s discount window this week, following unprecedented measures taken to break the stigma around its use.
Discount window borrowing rose to $28 billion on March 19, up from $11 billion on March 12.
The facility is a backstop funding source, secured against a range of pre-pledged collateral, but its use has traditionally been stigmatised because it could be perceived as a sign of weakness.
The Fed is “encouraged by the notable increase
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