Types of Transactions

Date: 2015-10-07; view: 353.

Basic Operations

OMO is executed by the Trading Desk of the Federal Reserve Bank of New York, on behalf of the entire Federal Reserve System. The Desk buys securities from government securities dealers who have an established trading relationship with the Fed. It pays for the securities by sending funds to the dealer's account at its clearing bank, as it takes delivery of the securities at the Fed. This action adds reserves to the banking system. Conversely, when the Fed sells securities to a dealer, it delivers the securities and the account of the dealer is debited. This action drains reserves from the banking system.

The Trading Desk most often engages in short-term repurchase agreements (RPs) which are used in situations that call for temporary additions to bank reserves. With RPs, the Desk buys securities from the dealers, who agree to repurchase them at a specified date and at a specified price. When the RPs mature, the added reserves are automatically drained.

If there is a temporary need to drain reserves, the Trading Desk executes reverse RPs with dealers in Treasuries. These transactions involve a contract for immediate sale of Treasury bills to the dealer, with a matching contract for later purchase from the dealer.

(1938 symbols)

Vocabulary list:_________________________________________________

open market operations - операции на открытом рынке

implement – исполнять, реализовывать

interest rate – ставка процента, ссудный процент

lending rate - ссудный процент

target rate - запланированные темпы роста

meet the demand – отвечать требованиям

discount – дисконт, учетная ставка

discount lending – скидка кредитования

window lending – дисконтное окно

drain – опустошать, истощать; утечка, отток

net change – разница цен закрытия

take delivery - получать выполненный заказ

debit – вносить в дебет, дебетировать

repurchase agreements – соглашение о покупке ценных бумаг с последующим выкупом по обусловленной цене