Dallas Fed President Logan Says Voluntary Central Clearing Could Improve Open Market Operations

Dallas Fed President Lorie K. Logan said the Federal Open Market Committee could improve the efficiency and effectiveness of open market operations by using a voluntary central clearing mechanism, which she said would also strengthen U.S. financial market stability. According to ChainCatcher, Logan said such an arrangement could enhance the Federal Reserve’s use of tools including the Standing Repo Facility. She noted the Standing Repo Facility is designed to provide liquidity to eligible financial institutions, but current market usage remains low.