Fed's Logan: Voluntary Central Clearing Mechanism May Enhance Open Market Operations Efficiency

Odaily Planet Daily News: Dallas Fed President Logan stated that if the Federal Open Market Committee conducts open market operations through a voluntary central clearing mechanism, it would help improve operational efficiency and effectiveness, while enhancing the stability of the U.S. financial market. Logan noted that such arrangements could improve the use of Fed tools, such as the Standing Repo Facility. This tool is designed to provide liquidity to eligible financial institutions, but market usage currently remains low. She also said that market leverage levels require careful management, and financial markets need to maintain an appropriate balance between the benefits and risks of leverage, as well as between leverage and liquidity.