Core Insights - U.S. banks borrowed $1.5 billion from the Federal Reserve's Standing Repo Facility, indicating potential funding tightness coinciding with quarterly corporate tax payments [1] - The corporate tax deadline coincides with a significant Treasury security settlement, with approximately $78 billion in payments due to the Treasury [2] - The Secured Overnight Financing Rate (SOFR) rose to 4.42%, surpassing the Interest on Reserve Balances (IORB) of 4.40%, suggesting heightened demand for secured funding [3][4] Funding Conditions - The liquidity pressure observed is expected to be temporary and is typical for major Treasury coupon settlement dates and quarterly tax deadlines [5] - The Fed's Standing Repo Facility serves as a backstop for funding shortages, providing daily overnight cash in exchange for eligible collateral [1][5] - On June 30, financial institutions borrowed $11.1 billion from the SRF, marking the largest borrowing since its inception [5]