Describe the current activity in the secondary T-bill market. How is this degree of activity be related to current market conditions?

Week 06: money markets | Business & Finance homework help

The secondary T-bill market is currently active as investors look to capitalize on the low interest rates that result from the Federal Reserve’s quantitative easing policy. As a result of this activity, short-term yields are at historic lows and long-term bond prices have increased due to investor demand for safety. This increased demand has allowed borrowers to access low cost funding which further stimulates economic growth and drives down overall borrowing costs in the process. The current degree of activity in the secondary T-bill market is reflective of the current market conditions which favor strong demand for lower yield debt instruments.