The $74.6 billion injection by the Federal Reserve on December 31, 2025, was a strategic "liquidity backstop" designed to prevent a year-end credit freeze.
🏛️ The Fed’s $74.6B Year-End Injection: What You Need to Know
On the final day of 2025, the Federal Reserve Bank of New York deployed $74.6 billion in short-term liquidity through its Standing Repo Facility. While the number sounds alarming, it’s a sign of the Fed’s "plumbing" working to keep the economy stable.
✨The Breakdown:
$31.5B in Treasury bonds.
$43.1B in Mortgage-Backed Securities (MBS).
✨Why did they do it?
👍Year-End Liquidity Crunch: Banks typically pull back on lending on Dec 31 to "clean up" their balance sheets for regulators (known as window dressing). The Fed steps in to ensure cash keeps flowing.
👍The Silver Surge: Recent volatility in the silver market (which briefly topped ₹2 lakh/kg) put extra pressure on institutional liquidity, requiring a temporary cash buffer.
👍Interest Rate Control: Private lending rates began to climb too high; the Fed injected cash to keep rates within their target range.
✨The "Crypto" Connection:
Markets reacted positively. Increased central bank liquidity is often seen as a "green light" for risk assets. Bitcoin stabilized around $88,000 following the news, as the move signaled that the Fed will not allow a liquidity crisis to trigger a broader market crash.
