According to Sina Finance on the 17th, the Federal Reserve Bank of New York's cash injection into the financial system was oversubscribed on Monday, indicating that the market still has a strong demand for funds until the beginning of 2020.

Primary dealers subscribed $54.25 billion for the Fed's 32-day repurchase operation, which expired on Jan. 17, exceeding the operating limit of $50 billion. This is the fourth regular buyback operation for the Fed to provide cross-year funds.

Although the financing market will be paid more and more attention as December progresses, market participants will also pay close attention to the mid-month period, as the market faces potential financial pressures due to the settlement of government bonds and corporate taxes. The overnight general collateral repurchase agreement interest rate is about 1.60%, up from about 1.70% at one point, which is already within the Fed's target range of the federal funds rate, according to ICAP.

"not only was the repurchase operation fully subscribed, but in mid-December, repurchase maintained a relatively good performance in the context of settlement and capital outflow."Bank of America CorporationMark Mark Cabana, head of US interest rate strategy, said. "this means that we may be in a relatively stable state by December 31."

Last week there were concerns that the market may have underestimated the risk of volatility and that interest rates could rise overnight, and at least one analyst speculated that the Fed might need to start another round of quantitative easing.

The fed has been injecting liquidity into the repo market since September 17, when the overnight repo rate for general collateral rose from about 2 per cent to 10 per cent. In addition, the Fed has been buying Treasury bills to increase reserves in the system.

Prior to Monday's regular repo operation, the previous three operations were also oversubscribed after the scale was increased.

The Fed also carried out overnight repurchase operations on Monday, with a limit of $120 billion. As with recent similar operations, subscriptions were undersubscribed, attracting only $36.4 billion in subscriptions, the lowest level since Oct. 9, according to the New York Fed.