The Federal Reserve's Term Auction Facility

11 Pages Posted: 22 Jul 2008

See all articles by Olivier Armantier

Olivier Armantier

Federal Reserve Bank of New York

Sandy Krieger

Federal Reserve Bank of New York

James McAndrews

Federal Reserve Bank of New York

Date Written: July 2008

Abstract

As liquidity conditions in the term funding markets grew increasingly strained in late 2007, the Federal Reserve began making funds available directly to banks through a new tool, the Term Auction Facility (TAF). The TAF provides term funding on a collateralized basis, at interest rates and amounts set by auction. The facility is designed to improve liquidity by making it easier for sound institutions to borrow when the markets are not operating efficiently.

Keywords: term auction facility, federal reserve, money market

JEL Classification: E50, E58, E59

Suggested Citation

Armantier, Olivier and Krieger, Sandy and McAndrews, James, The Federal Reserve's Term Auction Facility (July 2008). Current Issues in Economics and Finance, Vol. 14, No. 5, July 2008. Available at SSRN: https://ssrn.com/abstract=1169282

Olivier Armantier

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Sandy Krieger

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

James McAndrews (Contact Author)

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States
212-720-5063 (Phone)
212-720-8353 (Fax)

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