Open interest in the Chicago Board of Trade's Fed Funds futures contract rose to a second straight new record at 127,240 contracts as of June 26, 2001, topping the high of 124,657 set on June 25. The records continue to reflect increased investor interest and absorption in the interest rate decisions from the Federal Reserve's Open Market Committee. In its meeting on June 27 the Committee lowered the Fed Funds Target Rate by 1/4 point.
The financial world's institutions and money managers look to the Open Market Committee for news on the interest rate front and employ the Fed Funds contract to hedge their interest rate exposure.
In addition, volume in the Ten-Year Treasury Flex Options set a new record at 11,700 contracts on June 26, 2001, exceeding the previous high of 10,000 established on April 27, 2000.
