Banks exploiting Fed’s facility, borrowing at a lower rate, then profiting by parking at a higher-interest unit.

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via Bloomberg:

Banks borrowed a record amount from the Federal Reserve’s newest backstop facility in the most recent week as increasing wagers on interest-rate cuts made it a more attractive choice.

Data from the Fed showed an all-time high $131 billion in borrowing from the Bank Term Funding Program, or BTFP, in the week through Dec. 20. That compares to a previous record of $124 billion, reached in the week ended Dec. 13.

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