Bank borrowing from the Fed's discount window — a key measure of stress in the system — plunged last week.
Why it matters: It's a sign that the worst of the panic that started with Silicon Valley Bank's collapse in March may be in the past.
State of play: Borrowings from the discount window — where banks can get emergency cash in exchange for handing the Fed collateral like U.S. government bonds — plunged to $5.3 billion in the first week of May, from nearly $74 billion the previous week.
- Discount window borrowing had jumped to $153 billion in March, after the implosion of SVB.
Between the lines: The big drop in discount borrowing suggests that First Republic — which was taken over by the FDIC and sold for parts last week — was the central borrower from the Fed.
The bottom line: Despite recent gyrations in regional bank stocks, the Fed data should be a relief, since it doesn't show cash-strapped banks rushing to the Fed for help.