NY Fed adds 32 funds as counterparties

NEW YORK May 23 (Reuters) - The Federal Reserve Bank of New York on Monday added 32 new money market funds to its roster of counterparties it could eventually tap to drain cash from the financial system.

The new funds include the Federated Capital Reserves Fund, BofA Treasury Reserves and the JPMorgan Liquid Assets Money Market Fund. For a full list, see [here] Reverse repos are one of the tools that the Fed has said it can use to tighten monetary policy when needed to help prevent inflation.

In a reverse repo the New York Fed sells securities to financial firms for a set period, temporarily draining excess reserves from the financial system.

( Reporting by Kristina Cooke, Editing by W Simon )