As referenced in the February 17 operating policy statement, the Federal Reserve Bank of New York (FRBNY) is permitted to undertake certain open market and foreign currency transactions for the purpose of testing operational readiness. These small value exercises are a matter of prudent advance planning. The conduct of such exercises does not represent a change in the stance of monetary policy, and no inference should be drawn about the timing of any change in the stance of monetary policy in the future from them.
In connection with this authorization, the FRBNY’s Open Market Trading Desk intends to conduct a small value repo operation, which will occur on Wednesday, May 25, 2016, beginning around 9:40 AM ET and ending at 9:50 AM ET. The operation will have an overnight tenor and will be conducted with the primary dealer community. The operation will be multi-tranche (Treasury, agency, and agency MBS) and settle the same day. The total value of this operation will not exceed $700 million, with each dealer limited to one $10 million proposition in each tranche of the operation.
Results will be posted on the FRBNY’s website following the completion of the operation together with the results of other temporary open market operations.