ON RRP Facility
$0.9B
Near Zero · WoW: $-0.3B · MoM: $-9.5B
The Overnight Reverse Repurchase (ON RRP) facility allows eligible counterparties, such as money market funds, to park cash with the Federal Reserve overnight, earning a secured return. It serves as a floor for short-term interest rates and a tool for the Fed to manage liquidity. High usage levels typically signal an abundance of excess liquidity in the financial system, while low usage suggests liquidity has been drained or is being absorbed elsewhere.
ON RRP Components
| Measure |
Current ($B) |
WoW ($B) |
MoM ($B) |
| ON RRP Facility |
$0.9B |
$-0.3B |
$-9.5B |
As of March 4, 2026, the Federal Reserve's ON RRP facility saw usage at a remarkably low $0.9 billion. This figure represents a significant one-month decline of $9.5 billion, underscoring a persistent trend of liquidity draining from the facility. The current usage level firmly places the market in a 'Near Zero' regime, with the overall trend described as stable.
Liquidity Regime
The current ON RRP usage of $0.9 billion firmly places the liquidity regime in the 'Near Zero' category, indicating that financial institutions have minimal need to park cash with the Fed. This is a stark contrast to the peak usage observed around $2.5 trillion, reflecting a substantial reduction in excess liquidity seeking a safe haven at the Fed. The stable trend suggests that while usage is low, there isn't a rapid shift in either direction, implying a balanced absorption of liquidity elsewhere in the system.
Historical Parallels
| Date | ON RRP ($B) | 1M Later |
|---|
| Feb 02, 2026 |
$10.4B |
$0.9B |
| Jan 30, 2026 |
$9.6B |
$1.2B |
| Jan 29, 2026 |
$2.9B |
$0.6B |
| Jan 28, 2026 |
$1.1B |
$16.3B |
| Jan 27, 2026 |
$1.3B |
$3.8B |
Historically, periods of near-zero ON RRP usage have often coincided with ample liquidity in the broader financial system. This typically suggests that banks and other financial institutions have sufficient reserves and are actively deploying cash in the private market. Such conditions can be supportive for risk assets, as a lack of liquidity stress reduces funding costs and encourages investment, though it doesn't necessarily guarantee market rallies.
Market Snapshot
Note: ON RRP facility usage is a daily liquidity measure with limited direct equity market impact. Focus on broader liquidity conditions.
Market Snapshot
Top Movers
| Stock | Gap | 1M |
|---|
| PRH Prudential Financial, Inc. 5.95 |
+313.17% |
-76.0% |
| HTFC Horizon Technology Finance Corp |
+310.67% |
-75.5% |
| TCPA TransCanada PipeLines Limited 6 |
+294.28% |
-74.5% |
| ELC Entergy Louisiana, LLC COLLATERAL TR MT |
+246.41% |
-71.4% |
| ADAMH Adamas Trust, Inc. |
+184.11% |
-64.5% |
Bottom Movers
| Stock | Gap | 1M |
|---|
| SCCD Sachem Capital Corp. 6.00% Notes Due 2026 |
-67.44% |
+1.4% |
| OLPX Olaplex Holdings, Inc. |
-18.26% |
+12.7% |
| PMI Picard Medical, Inc. |
-14.64% |
-44.9% |
| STUB StubHub Holdings, Inc. |
-14.06% |
-22.3% |
| CIEN Ciena Corporation |
-9.18% |
+28.0% |
While the ON RRP facility is a daily measure of liquidity, its near-zero usage has limited direct, immediate impact on equity markets. Instead, it provides broader context on the overall liquidity conditions within the financial system. The low usage suggests that market participants are finding alternative, potentially more attractive, avenues for their cash, rather than needing to rely on the Fed's overnight facility.
Sector Performance
Sector Performance
| ETF |
Price |
Open Gap |
1M |
6M |
1Y |
YTD |
VS S&P 500 |
| XLF Financials |
$51.51 |
-0.52% |
-4.7% |
-3.2% |
+0.9% |
-6.0% |
-3.1% |
| XLK Technology |
$139.84 |
-0.49% |
-3.7% |
+8.0% |
+28.7% |
-2.9% |
-2.2% |
| XLY Consumer Discretionary |
$116.39 |
-0.40% |
-4.6% |
+1.6% |
+10.8% |
-2.5% |
-3.0% |
| XLU Utilities |
$47.27 |
-0.68% |
+10.9% |
+14.1% |
+22.6% |
+10.7% |
+12.4% |
Liquidity-Sensitive Stocks
Liquidity-Sensitive Stocks
| Stock |
Price |
Open Gap |
1M |
6M |
1Y |
YTD |
VS S&P 500 |
| CME CME Group |
$320.00 |
-0.57% |
+10.1% |
+21.1% |
+26.4% |
+17.2% |
+11.6% |
| BK BNY Mellon |
$118.39 |
-0.48% |
-2.6% |
+13.6% |
+36.2% |
+2.0% |
-1.1% |
| JPM JPMorgan Chase |
$299.39 |
-0.47% |
-2.8% |
+0.4% |
+16.7% |
-6.7% |
-1.3% |
| ICE Intercontinental Exchange |
$166.29 |
-0.97% |
-4.0% |
-4.8% |
-3.2% |
+2.7% |
-2.4% |
| STT State Street |
$126.54 |
-1.22% |
-4.6% |
+12.5% |
+33.5% |
-1.3% |
-3.0% |
| BLK BlackRock |
$1049.23 |
-0.91% |
-6.3% |
-5.4% |
+10.3% |
-2.0% |
-4.8% |
| BAC Bank of America |
$50.30 |
-0.82% |
-6.9% |
+0.3% |
+12.4% |
-8.5% |
-5.4% |
| GS Goldman Sachs |
$867.25 |
+0.30% |
-8.4% |
+18.7% |
+44.8% |
-1.3% |
-6.8% |
| SCHW Charles Schwab |
$96.04 |
-0.59% |
-8.7% |
-0.1% |
+23.7% |
-3.9% |
-7.1% |
| MS Morgan Stanley |
$167.58 |
-1.31% |
-9.5% |
+13.3% |
+32.5% |
-5.6% |
-7.9% |
For liquidity-sensitive stocks, a near-zero ON RRP regime generally implies a supportive environment. Financials (XLF) like JPMorgan Chase (JPM) and Bank of America (BAC) may benefit from a more active interbank lending market and potentially higher loan demand. Technology (XLK) giants such as Apple (AAPL) and Microsoft (MSFT), often seen as growth stocks, can thrive in periods of abundant liquidity due to lower borrowing costs and investor appetite for risk. Consumer discretionary (XLY) companies like Amazon (AMZN) and Tesla (TSLA) could also see tailwinds from a robust economic backdrop fueled by ample liquidity. Utilities (XLU) like NextEra Energy (NEE), while generally less sensitive, might still benefit from lower financing costs for their capital-intensive projects.
Positioning
Investors should consider positioning for a stable, ample liquidity environment, favoring growth-oriented and cyclically sensitive sectors. A 'Near Zero' ON RRP regime suggests that the market is not experiencing liquidity stress, which can be conducive to risk-taking. A significant and sustained increase in ON RRP usage, perhaps above $100 billion, would signal a shift in liquidity conditions, potentially prompting a re-evaluation of this outlook and a more defensive posture.