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The Federal Funds Market since the Financial Crisis


  • Ben R. Craig
  • Sara Millington


Before the financial crisis, the federal funds market was a market in which domestic commercial banks with excess reserves would lend funds overnight to other commercial banks with temporary shortfalls in liquidity. What has happened to this market since the financial crisis? Though the banking system has been awash in reserves and the federal funds rate has been near zero, the market has continued to operate, but it has changed. Different institutions now participate. Government-sponsored enterprises such as the Federal Home Loan Banks loan funds, and foreign commercial banks borrow.

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  • Ben R. Craig & Sara Millington, 2017. "The Federal Funds Market since the Financial Crisis," Economic Commentary, Federal Reserve Bank of Cleveland, issue April.
  • Handle: RePEc:fip:fedcec:00068

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    Financial Crisis; Federal Funds Market;


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