Primary Dealer Failures To Deliver Or Receive

Volume

Transaction volume is an indicator of market liquidity. These charts present insights into volumes across various short-term funding markets.

Primary dealer failures to deliver or receive

Aggregate failures to deliver or receive securities for primary dealers

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After selling securities, firms have a limited time to deliver the securities to settle their obligations to the securities buyers. For a variety of reasons, firms may be unable to meet these obligations—for instance, if they have sold a security short that they do not own and are then unable to obtain the security for delivery. In this case, the firm's unmet obligation to the buyers is recorded as a failure to deliver, and the firm may be subject to settlement charges.

Failures to deliver are more common when there is underlying illiquidity in the securities market, which makes it more difficult for dealers to obtain the securities they are obligated to deliver. Failures also frequently cascade: one firm failing to deliver a security promised to another may cause the second firm to fail on obligations to a buyer.

Series Used

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 Repo transaction volumes by venue
Transaction volumes in repo broken out by venue
 Primary dealer failures to deliver or receive
Aggregate failures to deliver or receive securities for primary dealers
 Federal Reserve Bank of New York overnight reference rate volumes
Dollar volume of transactions underlying reference interest rates
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Suggested Citation

Office of Financial Research, “OFR Short-term Funding Monitor,” refreshed daily, https://www.financialresearch.gov/short-term-funding-monitor/ (accessed ).