AI Data Insight
The latest data shows that on June 20, 2025, the Fed's overnight reverse repurchase agreement (ON RRP) balance plummeted to $138.28 billion, significantly down from the previous $205.05 billion. As money market funds heavily shift their funds toward short-term Treasury bills, the bottoming out of this buffer mechanism not only elevates volatility risks in the short-term repo market but also signals that the Federal Reserve's quantitative tightening (QT) is approaching its limit.