Demand Still Not Falling for NY Fed Reverse Repos

        15:44 EDT - Market participants had broadly expected surging demand for the New York Fed's reverse repos to ebb in May as the desire to gussy up company balance sheets for month-end concluded. They were wrong. Dealers have continued to park very-large amounts of cash at the Fed in exchange for borrowing central bank-owned Treasurys. Friday's reverse-repo operation totaled $185B, versus $176B Thursday and April 30's $208B. Market veterans have been confounded by the amounts, having expected them to shrink. While there are no signs the Fed is uncomfortable with what's happening, reverse repos are still in a testing phase. A risk is that Wall Street becomes dependent on them, possibly pressuring the Fed to make them permanent. (michael.derby@wsj.com)
        (END) Dow Jones Newswires

        May 02, 2014 15:44 ET (19:44 GMT)