U.S. banks' reluctance to lend cash may have caused repo shock - BIS
Share:
LONDON (Reuters) - The unwillingness of the top four U.S. banks to lend cash combined with a burst of demand from hedge funds for secured funding could explain a recent spike in U.S. money market rates, the Bank for International Settlements said.Cash available to banks for short-term funding all but dried up in late September, and interest rates deep in the plumbing of U.S. financial markets climbed into double digits.That forced the Fed to make an emergency injection of billions of dollars for..