Public Kempax report

Weekly Dollar Liquidity Report · 2026-08-08

Kempax Research

Loop report · 2026-08-08

Weekly Dollar Liquidity Report — Week of Aug 3–7, 2026

Executive summary

  • Liquidity is ample and stable, with an easing-rate tailwind. The Aug 6 H.4.1 release week ending Aug 5 shows Fed total assets $6.749T +$10.4B WoW , bank reserves $3.003T +$58.2B WoW , the Treasury General Account at $907.3B , and ON RRP near zero at $1.4B PrimeRates, Aug 7, Fed H.4.1 .
  • Quantitative tightening remains over; the Fed is buying $10B week of T-bills as "reserve management." Since runoff ended Dec 1, 2025, bill holdings have risen from $195.5B to $524.9B +$329.4B ; total Treasury holdings are up $341.2B and MBS down $122.8B principal rolling into bills . Reserves have hovered in a $2.88–3.18T range with no trend PrimeRates, Crypto Briefing . Net liquidity balance sheet minus TGA and RRP is ≈ $5.84T , up from $5.80T in mid-March eco3min net-liquidity index .
  • TGA is historically elevated — a slow passive drag, not an active one this week. $907B on the weekly H.4.1 basis Aug 5 and $962B on the daily-statement estimate — the 94th percentile since 2003 — but weekly net change was small: +$4.4B net over Aug 3–6 eco3min TGA, IndexBox daily trackers .
  • ON RRP is exhausted $1.4B day . The $2.37T facility Sep 2022 peak has fully drained; its drawdown offset 110% of QT, but that cushion is gone — any future balance-sheet reduction or sustained TGA build would now hit bank reserves one-for-one eco3min ON RRP, PrimeRates .
  • Policy: hold at 3.50–3.75% Jul 29, 9–3 vote; dissents wanted a hike , then a decisive repricing after the Aug 7 jobs shock NFP −23k . September pricing swung to the cut side: 34% cut probability, 2 cuts cumulatively priced by the Sep 15–16 meeting — though one tracker showed internally inconsistent boxes, so odds remain uncertain cf.com FOMC recap, Reuters, rateprobability .
  • Money markets are calm and cash-rich. SOFR printed 3.64–3.66% through Aug 6 top of the funds range — normal ; front-end yields: 1-mo bill 3.77%, 2-yr 4.18% Aug 5 ; 10-yr 4.63%, 30-yr 5.17% — a steep curve. Money-market fund assets reached $7.91T week ended Aug 5 , +$55.4B WoW , just off the $7.92T June record sofrrate.com, PrimeRates, ICI .
  • Credit is tight. HY option-adjusted spread 271 bps Aug 6 , −7 bps WoW −2.5% — described as "risk-on, limited compensation for default risk"; down from 327 bps in March convextrade, eco3min HY .
  • Risk-on week across assets. $SPY +4.62% to $773.26, $GLD +6.36% , $UUP −1.85% dollar soft , $TLT −1.18% over Jul 27→Aug 7 Fool, FinanceFeeds . Mid-2026 USD funding pressure in FX-swap markets remains a qualitative theme; exact basis levels unverified contentwave Aug 2026 .

Bottom line: Dollar liquidity conditions are ample and stable — no balance-sheet runoff, a benign TGA profile, near-record money-fund cash, tight credit, and a rate regime that repriced decisively toward easing after a weak jobs report. The main offsets are heavier Treasury supply the $125B mid-August refunding and a raised Q3 borrowing estimate and a persistent, unquantified USD funding-pressure theme in FX markets. Net bias for risk appetite: positive , with the September FOMC as the key binary event.

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Week-over-week change summary

Dimension Latest Aug 3–7, 2026 Change vs prior week Driver evidence --- --- --- --- Fed policy 3.50–3.75% target; EFFR 3.63% Hold Jul 29 ; post-jobs repricing to cut-side 34% cut odds for Sep cf.com, Reuters Fed total assets H.4.1 $6.749T wk end Aug 5 +$10.4B WoW ; +$212.8B since Dec 1 PrimeRates, H.4.1 20260806 Bank reserves $3.003T Aug 5 +$58.2B WoW ; 2026 range $2.883T–$3.184T PrimeRates SOMA T-bills $524.9B +$329.4B since Dec 3, 2025 $10B wk PrimeRates, Crypto Briefing TGA $907.3B weekly Aug 5 ; $962B daily est. Aug 6 Net +$4.4B Aug 3–6; 94th percentile level eco3min, PrimeRates, IndexBox ON RRP $1.43B Aug 6 zero; facility fully drained PrimeRates, eco3min SOFR 3.65% Aug 6 ; 3.64–3.66% Aug 3–6 flat; top of funds range sofrrate.com MMF assets $7.91T wk end Aug 5 +$55.4B WoW vs $7.85T Jul 29 ; near $7.92T June record ICI Credit HY OAS 271 bps Aug 6 −7 bps WoW −2.5% ; 278→271 Aug 3–6 convextrade Treasury issuance $125B Aug refunding 3 10 30-yr ; Q3 est. +$68B Supply headwind ahead Aug 11–13 auctions Treasury PR sb0590, PrimeRates Equities $SPY $773.26 +4.62% Jul 27→Aug 7 Fool, market data Bonds $TLT $82.76 −1.18% period; yields fell post-jobs WSJ, market data Dollar $UUP $28.07 −1.85% period FinanceFeeds, market data Gold $GLD $398.47 +6.36% period market data

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Charts

Bank reserves: $3.0T "ample" plateau, no trend

Treasury General Account daily cash changes, Aug 3–6, 2026 negative = drawdown = reserves injection

High-yield option-adjusted spread, Aug 3–6, 2026 tight, risk-on

Cross-asset period returns, Jul 27 → Aug 7, 2026 risk-on week

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Detailed findings

1. Federal Reserve balance sheet H.4.1, week ending Aug 5, released Aug 6 - Total assets $6.749T, +$10.4B WoW, +$212.8B since runoff stopped PrimeRates ; consistent with the $6.7T August figure Crypto Briefing ; release confirmed on the Fed site H.4.1 20260806 . - QT ended Dec 1, 2025. The Fed now makes "reserve management purchases" of $10B week of T-bills: bill holdings $195.5B Dec 3, 2025 → $524.9B ; total Treasury holdings +$341.2B; agency MBS −$122.8B principal rolling into bills . The coverage stresses this is plumbing, not stimulus PrimeRates, Crypto Briefing . - Net liquidity ≈ $5.84T derived: $6.749T − $0.907T TGA − $0.001T RRP , up modestly from $5.80T on Mar 18, 2026 eco3min net-liquidity index . - Interpretation: balance-sheet runoff is no longer a drain on reserves; the growth in T-bill holdings is the offsetting flow keeping reserves on the "ample" plateau see chart above .

2. Treasury General Account - Weekly H.4.1 WTREGEN, Aug 5 : $907.3B — 94th percentile since 2003, "historically high" eco3min, PrimeRates . Daily-statement basis: $970B on Jul 29, with daily deltas Aug 3–6 of −6.48 +5.41 +5.10 +0.32 → net +$4.4B $962B est. by Aug 6 IndexBox, Aug 4, Aug 5, Aug 6 . The daily vs weekly measures differ by $55B due to measurement basis — both are reported, but series should not be mixed in comparisons. - Interpretation: a very large TGA is a persistent if passive drain on reserves; weekly changes were small and mildly liquidity-neutral-to-positive. Watch for draws into the mid-August refunding cash raise Treasury PR sb0590 .

3. Reverse repo facility - ON RRP: $1.429B on Aug 6; $1.45B on Aug 7 — effectively zero PrimeRates, eco3min ; consistent with the $5.77B reading in early July Binance Square tracker . - Context: the facility drained from a $2.37T peak Sep 2022 to near zero by early 2026; the drain offset 110% of QT RRP −$2.37T vs balance sheet −$2.14T , leaving net liquidity flat — but that cushion is exhausted. Any future balance-sheet reduction or sustained TGA build would now hit reserves one-for-one eco3min .

4. Bank reserves - $3.003T Aug 5 , +$58.2B WoW — below the $3.077T Jul 1 reading, and inside the 2026 range of $2.883T late Jan to $3.184T early Apr : "no trend" PrimeRates . - Interpretation: reserves remain near the level generally treated as "ample." The $58B WoW build reflects the Fed's bill purchases more than offsetting the elevated TGA and currency drains. See chart above.

5. Treasury issuance - $125B August quarterly refunding 3-, 10-, 30-yr auctions in the Aug 11–13 window Treasury PR sb0590, newsroomamerica . - Q3 2026 net borrowing estimate raised $68B PrimeRates — heavier coupon supply; described as a "mixed bag for global liquidity" Euro Pacific . - Open item: early-August bill-auction bid-to-cover details not retrievable this run auction results pages are script-driven .

6. Money markets - SOFR: 3.65% Aug 6 ; daily range 3.64–3.66% Aug 3–6 — at the top of the 3.50–3.75% funds range, a normal relationship; EFFR 3.63% sofrrate.com, rateprobability . Open item: Aug 7 SOFR not yet published prints Aug 10 . - Front-end yields Aug 5 : 1-mo bill 3.77%, 2-yr 4.18%; 10-yr 4.63%, 30-yr 5.17% — a steep curve; yields fell after the jobs miss PrimeRates, WSJ . - Money-market funds: $7.91T week ended Aug 5 , +$55.4B WoW from $7.85T Jul 29 ICI — just under the $7.92T June record ecmsource ; a massive dry-powder pool that should help absorb upcoming supply. - Open item: commercial paper rates outstandings and brokered-deposit dynamics not retrieved this run.

7. Credit conditions - HY OAS: 271 bps Aug 6 ; 278→273→275→271 over Aug 3–6 — tightened 2.5% WoW; page characterizes the level as "tight… risk-on, limited compensation for default risk," in the sub-350 bps late-cycle complacency zone convextrade . Spreads have compressed materially since the 327 bps March reading eco3min HY . - $HYG closed $79.61 on Aug 7, +0.43% over Jul 27–Aug 7, with a breakout above the 79.6 resistance level market data . See chart above. - Open item: IG BBB OAS level not retrieved this run.

8. Global dollar funding FX - Qualitative theme persists: mid-2026 USD funding pressure — more frequent intraday repricing of 1W–1M FX forward points, dealer spread-widening ahead of coupon settlements, Asia-session squeezes in USD JPY and CNH paths; the combination of a high TGA, near-zero RRP, and 1W–1M swap steepening is flagged as the "clearest early warning" contentwave Aug 2026, FX carry, hedged carry . Open item: basis levels in basis points not retrieved CME publishes a cross-currency basis watch . - Dollar: soft. $UUP −1.85% over Jul 27→Aug 7, closing $28.07 at lower support; pre-jobs strength Iran-talks headlines reversed into a "Fed rate shift" + gold surge after the NFP miss FinanceFeeds, CNBC . Open item: DXY spot level not retrieved. - Foreign official holdings: TIC data is monthly and lags next release mid-August ; no fresh print this week FRED Blog .

9. Cross-market impact assessment - Equities — positive. $SPY closed $773.26, +4.62% over Jul 27→Aug 7, with the Aug 7 rally on the jobs shock Fool, Investopedia . Ample reserves, a flat TGA path, and the cut repricing all support valuations. - Bonds — supportive bias. Front-end yields are modest 1-mo 3.77% and the curve steep 10-yr 4.63% vs 2-yr 4.18% ; yields fell after the jobs miss WSJ . $TLT −1.18% for the period, but the rate-cut repricing is supportive going forward. Watch the $125B mid-August coupon supply and +$68B Q3 estimate as offsets PrimeRates . - Dollar — soft-to-mixed. $UUP −1.85%; the USD funding-pressure theme keeps FX-swap markets in focus; $GLD +6.36% as a mirror of dollar softness and rate expectations FinanceFeeds . - Risk appetite — improved, with cross-currents. Tight HY OAS 271 bps , record money-fund cash $7.91T , ample reserves $3.0T , and easing repricing all argue for continued risk-on; the offsets are oil Brent $82.27, +5.45% m m as of Aug 7 and the binary September FOMC TradingEconomics, Reuters .

Conclusion

Dollar liquidity is ample, stable, and getting a tailwind from the easing repricing : the balance sheet is growing $10B week through T-bill purchases, reserves sit at the $3.0T "ample" plateau, the TGA is high but not actively draining, money funds hold record cash, and credit spreads are tight. Markets leaned risk-on $SPY +4.6%, $GLD +6.4%, HY tight while the dollar softened.

Key risk to monitor: the exhausted ON RRP cushion meeting the mid-August supply test . With ON RRP at $1.4B, any renewed balance-sheet contraction or sustained TGA build would hit bank reserves one-for-one — just as the $125B refunding Aug 11–13 and the +$68B Q3 raise test market absorption against a 94th-percentile TGA. The second watchpoint is the September FOMC Sep 15–16 : hike dissents 3 at the July meeting versus 34% market-priced cut odds after the weak payrolls print — a binary two-way policy risk.

Open items

  • SOFR print for Aug 7 not yet published next business day Aug 10 ; reported through Aug 6.
  • FX-swap basis levels bp and DXY spot level not retrieved — the USD funding-pressure theme is qualitative this week.
  • IG BBB OAS level not retrieved HY OAS 271 bps is the measured anchor .
  • Commercial paper rates outstandings and brokered-deposit dynamics not retrieved.
  • Bill-auction bid-to-cover details for Aug 3–7 not retrievable this run.
  • TIC foreign-official holdings data is monthly lagged — no fresh print this week.
  • September cut odds carry tracker uncertainty : one source shows internally inconsistent boxes 49% "hike" box vs 34.4% cut table — cross-check against primary pricing sources at decision time.
  • TGA series basis : daily-statement $962B vs weekly H.4.1 $907B differ by $55B by measurement design — both cited; do not mix series in comparisons.
  • Several level values were cross-checked via secondary trackers; re-verify against primary sources Fed H.4.1 tables, FRED before any investment decision.

Sources index primary

  • Fed H.4.1 release 2026-08-06 · H.4.1 current · Fed balance-sheet developments
  • PrimeRates: Fed adds $329B bills, reserves near $3T Aug 7, 2026 · Crypto Briefing: Fed bill purchases $25B mo · Crypto Briefing: balance sheet $6.7T
  • eco3min: TGA dataset · eco3min: ON RRP dataset · eco3min: net-liquidity index · eco3min: HY spread dataset
  • IndexBox TGA daily trackers · Treasury DTS fiscaldata
  • sofrrate.com Aug 2026 SOFR · NY Fed SOFR · FRED SOFR · FRED RRPONTSYD · FRED WTREGEN · FRED WALCL
  • ICI MMF weekly assets · convextrade HY OAS · FRED HY OAS
  • Treasury refunding PR sb0590 · TreasuryDirect auctions
  • cf.com FOMC recap Jul 2026 · rateprobability Fed · Reuters: rate-futures after jobs data · CME cross-currency basis watch · contentwave USD funding Aug 2026
  • Market data closes through 2026-08-07 : $SPY, $HYG, $TLT, $UUP, $GLD · Fool market recap · FinanceFeeds FX summary

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<sub Report details — Prepared 2026-08-09 · Coverage week Mon Aug 3 – Fri Aug 7, 2026 vs prior week Jul 27–31 · Data as of 2026-08-07 market data , H.4.1 week ending Aug 5 released Aug 6 , TGA weekly Aug 5, ON RRP through Aug 7, SOFR through Aug 6, MMF week ended Aug 5 · Loop: Weekly Dollar Liquidity Report loop-095c989a-df34-4d81-836c-e6c12657aea7 · Run: looprun-5b0eae2a-fe46-4c29-b2f1-6467c2c943f1 · Session: Author weekly dollar liquidity report loopsession-b2817ade-c34f-4c59-acc6-6206fbfe3844 · Workspace ws-01 · Status: research complete. This report is for internal review and does not constitute an investment recommendation; no trading actions were taken.< sub