The Federal Reserve'​s latest "Minutes of the Federal Open Market Committee, July 29–​30, 2025," tell us, "The manager turned next to money markets. Unsecured overnight rates remained stable over the intermeeting period. Rates on Treasury repurchase agreements (​repo) were somewhat higher than the low levels seen in the previous intermeeting period. The manager observed that two factors contributed to this slight increase: the normal upward pressure on money market rates associated with the June quarter-​end; and the rise in net Treasury bill issuance amid the rebuilding of the Treasury General Account (​TGA) balance following the increase in the debt limit in early July. On June 30, as market rates climbed modestly above the standing repo facility'​s (​SRF) minimum bid rate at quarter-​end, there was material usage of the facility, with counterparties borrowing a bit more than $​11 billion, the highest utilization to date." It explains, "​The manager also discussed the projected trajectory of various Federal Reserve liabilities. With increased Treasury bill issuance associated with the rebuilding of the TGA balance likely to result in a rise in money market rates, take-​up at the overnight reverse repurchase agreement (​ON RRP) facility was expected to decline to low levels relatively soon. Market indicators continued to suggest that reserves remained abundant; however, ongoing System Open Market Account (​SOMA) portfolio runoff, a substantial expected increase in the TGA balance, and the depletion of the ON RRP facility were together likely to bring about a sustained decline in reserves for the first time since portfolio runoff started in June 2022. Against this backdrop, the staff would continue to monitor indicators of reserve conditions closely. The manager also noted that there would be times -- such as quarter-​ends, tax dates, and days associated with large settlements of Treasury securities -- when reserves were likely to dip temporarily to even lower levels. At those times, utilization of the SRF would likely support the smooth functioning of money markets and the implementation of monetary policy." The Minutes also say, "Conditions in U.​S. short-​term funding markets remained orderly over the intermeeting period while displaying typical quarter-​end dynamics. The One Big Beautiful Bill Act, which became law on July 4, ended the previous debt issuance suspension period, after which the TGA balance increased from $​313 billion on July 3 to an expected $​500 billion by the end of July. Rates in secured markets were, on average, somewhat elevated relative to the average over the previous intermeeting period, owing in part to quarter-​end effects. Although upward pressure on repo rates was modest at quarter-​end, take-​up at the SRF was $​11.​1 billion on June 30 -- its highest level since the inception of the facility -- as the addition of an early settlement option seemed to encourage participation. Average usage of the ON RRP facility was little changed over the intermeeting period." The Minutes add, "Many participants discussed recent and prospective developments related to payment stablecoins and possible implications for the financial system. These participants noted that use of payment stablecoins might grow following the recent passage of the GENIUS Act (​Guiding and Establishing National Innovation for U.​S. Stablecoins Act). They remarked that payment stablecoins could help improve the efficiency of the payment system. They also observed that such stablecoins could increase the demand for the assets needed to back them, including Treasury securities. In addition, participants who commented raised concerns that stablecoins could have broader implications for the banking and financial systems as well as monetary policy implementation, and thus warranted close attention, including monitoring of the various assets used to back stablecoins."

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