A repurchase agreement (repo) is a form of short-term borrowing for dealers in government securities. For a repo, a dealer sells government securities to an investor, usually overnight, and buys them back the following day at a slightly higher price. The small price difference is an implicit overnight interest rate. Repos are typically used to raise short-term capital. They are also commonly used in central bank open market operations. During the early 2020s, the Federal Reserve instituted changes that massively increased the volume of repos traded, a trend it began to unwind in 2023.