The following frequently asked questions (FAQs) provide further information about the Federal Reserve's Standing Repo Facility (SRF) operations.
What are SRF operations?
At its July 2021 meeting, the Federal Open Market Committee (FOMC) established the SRF to serve as a backstop in money markets to support the effective implementation and transmission of monetary policy and smooth market functioning. The FOMC has authorized and directed the New York Fed’s Open Market Trading Desk (the Desk) to conduct overnight repurchase agreement (repo) operations with a specified minimum bid rate and aggregate operation limit.
When the Federal Reserve enters into an overnight repo transaction, it buys a security from an eligible counterparty and simultaneously agrees to sell the security back the next day. The difference between the purchase price and the sale price of the securities implies a rate of interest earned by the Federal Reserve on the transaction. The FOMC sets the SRF minimum bid rate, which is the minimum interest rate the Federal Reserve is willing to receive in an SRF operation.
Current operational parameters
| Standing Repo Facility Parameters | |
| Schedule: | Every business day from 1:30 p.m. to 1:45 p.m. (ET), unless otherwise stated |
| Aggregate operation limit: | $500 billion |
| Proposition limit: | Two propositions per eligible security type, subject to a $20 billion maximum per proposition |
| Minimum bid rate: | 4.50 percent |
| Eligible counterparties: | Primary dealers and SRF counterparties, which include depository institutions |
| Eligible securities: | U.S. Treasuries, agency debt, and agency mortgage-backed securities (for additional details on the security types see Repo Securities Schedule) |
On May 28, 2025, the Desk announced changes to the SRF’s daily operational schedule. The table below shows the SRF operational parameters once these changes become effective on June 26, 2025.
| Standing Repo Facility Parameters (EXPECTED TO BE IN EFFECT JUNE 26, 2025) |
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| Schedule: | Every business day from 8:15 to 8:30 a.m. ET, unless otherwise stated | Every business day from 1:30 to 1:45 p.m. ET, unless otherwise stated |
| Aggregate operation limit: | $500 billion | $500 billion less the accepted amount from the morning operation |
| Proposition limit: | Two propositions per eligible security type per auction, subject to a $20 billion per proposition limit | |
| Minimum bid rate: | The SRF bid rate specified by the FOMC. | |
| Settlement: | Same-day settled. Bank of New York (BNY) tri-party repo conventions apply. Funds will typically be delivered within thirty minutes following the operation close time. | Same-day settled. BNY tri-party repo conventions apply. |
| Eligible counterparties: | Primary dealers and SRF counterparties, which include depository institutions | |
| Eligible securities: | U.S. Treasuries, agency debt, and agency mortgage-backed securities (for additional details on the security types see Repo Securities Schedule) | |
How will SRF operations be conducted?
The Desk conducts SRF operations via FedTrade, the Desk's proprietary trading system, using a multiple-price auction format.
How will changes to SRF operations be communicated?
The FOMC directs the Desk to conduct SRF operations as detailed in its Continuing Directive for Domestic Open Market Operations and implementation note. Any changes to the operational parameters not provided by the FOMC’s Continuing Directive for Domestic Open Market Operations and implementation note will be announced on the New York Fed’s website.
How is the minimum bid rate for SRF operations determined?
The minimum bid rate for SRF operations is set by the FOMC and detailed in the most recent implementation note.
Why will a daily morning SRF operation be offered beginning on June 26, 2025?
The addition of daily morning SRF operations is intended to enhance the effectiveness of the SRF. The morning SRF operation allows for the execution and settlement of SRF trades earlier each day compared to the afternoon SRF operation, which, based on feedback from primary dealers and SRF counterparties, may better align with the timing of the funding needs of some SRF counterparties.
Beginning June 26, 2025, how will the $500 billion SRF aggregate operation limit be allocated between the morning SRF operation and afternoon SRF operation?
The current aggregate SRF operation limit of $500 billion will apply to the combined daily operations. Specifically, the morning SRF operation will have an aggregate size of $500 billion, and the afternoon SRF operation will be sized to $500 billion less the total amount of accepted propositions from the same day’s morning SRF operation. The Desk intends to announce the aggregate limit of each business day’s afternoon SRF operation on the Repo Operations webpage shortly after the morning SRF operation has concluded.
How are propositions submitted in SRF operations?
The minimum proposition size is $1 million, and propositions must be submitted in $1 million increments. Each counterparty is permitted to submit up to two propositions per security type that are at the minimum bid rate or higher and do not exceed the specified proposition limit.
How are SRF awards determined?
The Desk conducts SRF operations in a multiple-price auction format, in which allocations are made to participants at the rate they bid in the operation. Bid rates can be at or above the minimum bid rate. Individual awards are made at the rates received by the Desk and awards are allocated in $1 million increments.
If the total amount of propositions received is less than or equal to the aggregate operation limit, all counterparties will be awarded at their submitted rates for their full submitted amounts (up to the per bid maximum amount).
If the total amount of propositions received is greater than the aggregate operation limit, individual propositions reflecting the most competitive rates relative to the benchmark rates set internally for each security type will be awarded at their submitted rates up until the aggregate operation limit is reached. After that, individual propositions may either be partially awarded or not awarded based on their proximity to those benchmark rates for each security type.
Whom should SRF counterparties call if they experience difficulties during a FedTrade operation?
Counterparties may call the Desk with submission and verification questions. For system-related problems, primary dealers may call primary dealer support.
How are trades resulting from SRF operations settled?
In the tri-party repo market, trades are settled on the books of a clearing bank. Trades resulting from SRF operations are cleared and settled on the tri-party repo platform operated by BNY. BNY acts as an agent to the Desk and the Desk’s counterparty by taking custody of securities, valuing these securities and ensuring the appropriate margin is applied, and settling the transaction on its books.
Trades resulting from SRF operations settle on a same-day basis by the tri-party repo market close, unless otherwise stated by the Desk. Trades resulting from daily morning SRF operations, which are expected to begin on June 26, 2025, will allow for an earlier settlement. The Desk will position necessary funds on the BNY tri-party repo platform typically within thirty minutes of the operation close time on a best-efforts basis. Actual settlement timing will vary and depends in part on the delivery of securities. Cash settlement amounts arising from SRF trades each day are netted against maturing trades. The repurchase of securities by the Desk on the maturity date will occur in the afternoon following the daily SRF operations on the BNY tri-party repo platform.
How will the Desk communicate SRF operation results?
After the completion of an SRF operation, the Desk publishes a summary of the results that provides the total amount submitted, total amount accepted, and weighted-average award rate by security type, as well as the stop-out rate, high rate, and low rate of propositions for each security type.
Section 11 of the Federal Reserve Act, as amended by section 1103 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, requires that detailed operational results, including counterparty names, be released two years after each quarterly transaction period.
