We see benefits to creating a short-term facility, even if the benefits come later.

A flood of market liquidity has pressured repurchase agreement rates, prompting some investors to pivot away from traditional forms of cash management.

Market participants have been hesitant to accept SOFR as the successor to Libor, but uniting around a single reference rate is increasingly important to keep benchmark markets from becoming fragmented.

As regulators push to transition away from Libor, sales of Treasuries linked to the successor rate could boost the new benchmark’s credibility and expand nascent markets for related debt and derivatives.

We think there are policy tools in the Fed arsenal that wouldn’t materially alter the soundness of the banking system but could allow cash to move more freely.

Short-term bonds could rise in price and potentially maintain a high degree of liquidity in response to Federal Reserve rate cuts.

Markets can prove interesting when the price of liquidity abruptly increases and high yield is no longer the highest-yielding investment.

Investors are walking a tightrope today, balancing risk-taking and risk management.

Markets don’t always take a break during the festive season.