If the interest rate on treasury bills is lower than the federal funds rate, the quantity of overnight loans supplied increases and the demand for treasury bills decreases.
"Interest rate is the amount of interest paid for a particular period of time with respect to the amount lent, deposited, or borrowed."
"If the rate of interest on treasury bills is less than this will increase the demand of loans but decreases the demand of treasury bills. Treasury bills are known as short term debt instruments issued by the Government of India and currently issued in three tenors, that is, 91 days, 182 days, 364 days."
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