Bloomberg News

Fed Funds Projected to Open at 0.10% to 0.14%, ICAP Says

March 12, 2012

Fed funds, the U.S. overnight inter-bank lending rate, is projected to open in a range of 0.10 percent to 0.14 percent, within the Federal Reserve’s target of zero to 0.25 percent.

Fed funds closed at 0.05 percent on March 9 after trading from 0.05 percent to 0.13 percent and averaging 0.12 percent, ICAP Plc, the world’s largest inter-dealer broker, said in an e- mailed statement. ICAP’s monthly average is 0.11 percent.

The central bank will acquire Treasuries maturing from February 2036 to February 2042. The purchases are part of the Fed’s program to replace $400 billion of short-term debt in its portfolio with longer-term Treasuries to reduce borrowing costs and counter risks of a recession.

The central bank plans to purchase from $1.75 billion to $2.25 billion of securities today, according to the New York Fed’s website.

To contact the reporter on this story: Liz Capo McCormick in New York at emccormick7@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net


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