The Primary Dealer Credit Facility

Antoine Martin and Susan McLaughlin

Economic Policy Review, 2022, vol. 28, issue 1

Abstract: The Federal Reserve established a new Primary Dealer Credit Facility (PDCF) in March 2020, to allow primary dealers to support smooth market functioning and facilitate the availability of credit to businesses and households, in the face of deteriorating conditions in the market for triparty repo financing due to the coronavirus pandemic. A similar facility had been established in March 2008 to help restore the orderly functioning of the market, following the near-bankruptcy of Bear Stearns, and to prevent the spillover of distress to other financial firms. This article provides an overview of the 2020 PDCF and compares it to the 2008 version.

Keywords: Primary Dealer Credit Facility; COVID-19 pandemic; Federal Reserve lending facilities (search for similar items in EconPapers)
JEL-codes: E58 G21 G24 (search for similar items in EconPapers)
Date: 2022
Note: This volume is a special issue titled “Policy Actions in Response to the COVID-19 Pandemic,” and features ten articles by New York Fed economists and coauthors from Markets, Supervision, the Board of Governors, and the Boston Fed.
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