April 22, 2019 / 1:09 PM / a month ago

MONEY MARKETS-U.S. fed funds rate widens premium over Fed's interest on reserves

NEW YORK, April 22 (Reuters) - The average borrowing cost for U.S. banks to borrow excess reserves overnight increased further above what the Federal Reserve pays on excess reserves on Friday, according to New York Federal Reserve data on Monday.

The average or “effective” federal funds rate climbed to 2.44% from 2.43% on Thursday, bringing its premium over the interest rate the U.S. central bank pays on the excess reserves that banks leave with it to a record 4 basis points. It was 3 basis points on Thursday. (Reporting by Richard Leong Editing by Chizu Nomiyama)

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