Thursday , September 19 2019
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There’s a black hole in the dollar funding market

Summary:
It’s been a while since we checked in on what’s percolating through the mind of financial-plumbing specialist Zoltan Pozsar at Credit Suisse. And it looks like this was an error because we may have missed a whopper of a dollar funding story.Here’s the gist from the opening of his latest note (with our emphasis, oh, and RRP stands for reverse repurchase agreement):The FOMC should forget about r* for the moment and focus on Sagittarius-A* – the supermassive black hole at the center of global dollar funding markets.The black hole is the foreign RRP facility, which has seen close to 0 billion of inflows since the beginning of the year.The driver of these inflows is the curve inversion, and the longer the inversion persists the more inflows will follow. The trade war is also contributing to

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