Tri-party repo trades backed by GSE debt gain popularity
Agency bond trades made up 37% of total tri-party transactions on September 4
Market participants are increasingly turning to US government-sponsored enterprise (GSE) and agency debt over Treasuries as collateral for tri-party repo transactions, data from the Office of Financial Research (OFR) shows.
On September 4, tri-party repo transactions backed by GSE debt accounted for 37% of the $1.25 trillion total. This is up from a year-to-date low of 30% on March 31, and above the six-year average of 31%. Trades backed by US Treasuries made up 43% of the total, down from a year
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