Hi All

I read the Currency News Archive in Yahoo and every few days the next Sort of Note is posted. I was wondering if somebody could explain the importance of this type of FR action. In particular the paragraph hilighted in blue.

Thank You
NEW YORK, Dec 23 (Reuters) - The Federal Reserve said on Friday it had added temporary reserves to the U.S. banking system through five-day system repurchase agreements. The benchmark federal funds rate last traded at 4.25 percent, the Fed's current target for the overnight lending rate.

Further details of this operation are available at: http://www.ny.frb.org/markets/omo/dmm/temp.cfm


At the link the data is:


T o execute monetary policy, short-term repurchase and reverse repurchase agreements are utilized to temporarily influence the size of the Federal Reserve System's portfolio and affect day-to-day trading at the federal funds market.

Temporary Open Market Operations
http://www.ny.frb.org/images/spacer.gif Temporary Open Market Operations for December 23, 2005
Last Updated: December 23, 2005 9:53 AM
Number of Operations Today: 1

http://www.ny.frb.org/images/spacer.gif Deal Date: Friday, December 23, 2005
Delivery Date: Friday, December 23, 2005
Maturity Date: Wednesday, December 28, 2005
Type of Operation1: Repo
Settlement: Same Day
Term of Operation2: 5 Days
Operation Close Time: 09:30 AM