Below is an excerpt from Colin Twiggs' November 29, 2023 Market Analysis, published with permission.

Fed stealth liquidity may presage early rate cuts

Commercial bank cash assets, representing reserves held at the Fed, reversed its down-trend after September 2022 -- when the UK gilt crisis occurred -- and is now edging higher, reflecting stealth liquidity support from the Fed and Treasury.

Commercial Bank Reserves

Fed QT is reducing liquidity at the rate of $95 billion per month but the effect of discount lending and reduction of RRP facilities means that net liquidity is increasing...

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