Auctions of CMB (Cash Management Bills) under SFP (Supplemental Financing Program) are quietly increasing in frequency and in amounts raised.
CMB is a short-term security sold by the U.S. Department of the Treasury. The maturity on a CMB can range from a few days to six months. The money raised through these issues is used by the Treasury to meet any temporary shortfalls. CMBs tend to pay higher yields than bills with fixed maturities, but their shorter maturities lead to lower overall interest expense.
But there is another type of CMB since October 2008 (SFP, or Supplemental Financing Program) , whose proceeds are used exclusively by the Federal Reserve for its various lending and credit programs to support the financial industry and also to support its own balance sheet.
Auctions of CMB under SFP have increased recently, after a relatively quiet period since November last year.
Regular CMB issues in 2010 so far:
- March 30: 18-day CMB, $17 billion
- April 1: 10-day CMB, $21 billion
- February 3: 21-day CMB, $5 billion
- February 24: 56-day CMB, $25 billion
- March 3: 56-day CMB, $25 billion
- March 10: 56-day CMB, $25 billion
- March 17: 56-day CMB, $25 billion
- March 24: 56-day CMB, $25 billion
- March 31: 56-day CMB, $25 billion
- April 7: 56-day CMB, $25 billion (scheduled)