The quantity of money. Reserves, TGA, RRP, funding at the margin.
Reserves Fell $59.5bn. The Chequebook Built $59.3bn. The Parking Lot Holds $0.20bn.
Reserve balances were $2,962.6bn as of 21 October, down $59.5bn on the week, and the Treasury's general account built $59.3bn over the same seven days. The drain and the build are the same number. The account then added $37.3bn more in the two sessions to 23 October, to $982.5bn, which lands in Wednesday's reserve print with $0.20bn parked under it. Secured overnight money fixed 2 basis points above the administered rate on 23 October.
Reserves Fell $7.5bn With the Account Flat. Then the Account Built $62.7bn.
Reserve balances were $3,022.1bn as of 14 October, down $7.5bn on the week, and the Treasury's general account closed at $885.8bn on both ends of it - so the drain was not account building. The account then built $62.7bn in the two sessions to 16 October, to $948.5bn, its highest since 30 September. Reverse repo take-up is $0.33bn, secured overnight money sits 2 basis points through the administered rate, and that build lands in Thursday's reserve print with nothing parked under it.
Reserves Added $81.6bn. The Parking Lot Is Empty.
Reserve balances rose $81.6bn in the week to 7 October, to $3,029.7bn - a second consecutive weekly add. The Treasury's general account drained $98.2bn over the same window and then rebuilt $16.3bn off its 2 October low, reverse repo take-up is $0.3bn, and secured overnight money sits 3 basis points through the administered rate with no stress priced.
The Drain Reversed. The Account Paid For It.
Reserve balances rose for the first time in this sequence, to $2,948.1bn (as of 30 Sep), while the Treasury's cash balance fell $112.8bn in 3 sessions. Overnight secured money is 2 basis points through the administered rate and 2s10s is at 47.1 basis points, the widest of the move.
The Discount Closed. The Floor Is the Market Now.
There is no longer a discount for leaving cash in the market. The rate paid on secured overnight money has risen to meet the rate the Fed pays on reserves, the facility that used to absorb Treasury issuance is empty, and reserve balances are falling - with no stress priced anywhere.
The Floor Moved Up. There Is Nothing Underneath It.
The administered rate stepped 25bp higher on 17 Sep. The reverse repo buffer beneath it is $0.6bn.
The RRP Buffer Is Gone. Reserves Are on Their Own.
Reverse repo facility take-up is down to $1.4bn. The monetary shock absorber is empty.
Reserves Are Fine. The Composition Is Not.
Nobody is short dollars. Somebody is short duration.