Euro Feds

AAA

DEFINITION of 'Euro Feds'

A federal wire transmission advancing funds in Eurodollars from a U.S. bank with excess funds to another with insufficient reserves. Euro Feds settling in London clear through the clearingshouse interbank payments system (CHIPS) whereas transactions taking place in New York go through the Fedwire.

INVESTOPEDIA EXPLAINS 'Euro Feds'

In some instances it may be more attractive for a U.S. bank to borrow or place funds in the Euro market rather than buying or selling Federal funds. However rates on both Fed funds and overnight Eurodollars are closely related.

RELATED TERMS
  1. Federal Funds Rate

    The interest rate at which a depository institution lends funds ...
  2. Eurocurrency

    Currency deposited by national governments or corporations in ...
  3. Eurodollar

    U.S.-dollar denominated deposits at foreign banks or foreign ...
  4. Federal Funds

    Excess reserves that commercial banks deposit at regional Federal ...
  5. Reserve Requirements

    Requirements regarding the amount of funds that banks must hold ...
  6. Euro Deposit

    The equivalent of a money market rate on cash deposits made in ...
Related Articles
  1. Inside National Payment Systems
    Economics

    Inside National Payment Systems

  2. Get To Know The Major Central Banks
    Forex Education

    Get To Know The Major Central Banks

  3. How International Tax Rates Impact Your ...
    Forex Education

    How International Tax Rates Impact Your ...

  4. The Fed's New Tools For Manipulating ...
    Bonds & Fixed Income

    The Fed's New Tools For Manipulating ...

comments powered by Disqus
Hot Definitions
  1. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  2. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  3. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  4. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  5. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
  6. Correlation

    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used ...
Trading Center