BREAKING: Demand for the Fed’s Standing Repo Facility (SRF) surged to +20.4 billion on Friday, the highest since the facility became permanent in 2021. The SRF allows banks to borrow cash from the Fed using government bonds as collateral, acting as a key source of liquidity support for the financial system. The rise in usage over the last few weeks shows growing stress in short-term lending markets and a tighter supply of cash across the system. Market liquidity has become scarcer due to ongoing Quantitative Tightening (QT) and high Treasury issuance. If these funding pressures persist, the Fed may eventually need to inject liquidity again, like it did during the 2019 repo crisis. Liquidity pressures are quietly building beneath the surface.(The Kobeissi Letter)