On Tuesday, May 26, the scale of the Federal Reserve's overnight reverse repurchase agreement (RRP) reached $1.787 billion, with six counterparties participating in the transaction, compared to $965 million on the previous trading day.
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As a routine tool used by the Federal Reserve to regulate market liquidity, changes in the scale of overnight reverse repurchase agreements often directly reflect short-term market supply and demand for funds. The significant increase in scale compared to the previous trading day also indicates that there is currently a growing demand in the market for low-risk short-term investment targets.
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