FED EXPECTED TO ARRANGE SYSTEM REPURCHASES
The Federal Reserve is likely to add
temporary reserves to the banking system this morning by
executing system repurchase agreements, economists said.
    The Fed faces a need to add a large volume of reserves this
statement period to offset a drain caused by rising Treasury
balances at the Fed after the June 15 tax date.
    Most economists are predicting over-the-weekend system
repurchases. But some, who see a smaller adding requirement,
are forecasting a less aggressive combination of three- and
six-day repos. Fed funds were trading at 6-3/4 pct, close to
yesterday's 6.81 pct average.
 Reuter
