The Federal Reserve is expected to directly supply temporary reserves by arranging three or four-day System repurchase agreements economists said. They said there is less chance that it will add reserves indirectly instead. If the Fed fails to supply reserves however economists said this will be a strong indication that it is firming policy perhaps in preparation for a near term discount rate increase from 5-1/2 pct. Federal funds which averaged 6.29 pct on Friday opened at 6-7/16 pct and remained there in early trading.
FED EXPECTED TO SET MULTI-DAY REPURCHASE PACTS