The Federal Reserve Bank of New York injected $66bn into short-term lending markets on Monday, building on a series of operations from last week to support the market after a severe bout of turmoil.

The cost of borrowing cash overnight in exchange for US Treasuries — known as a repurchase agreement, or repo — soared early last week, pushing the main interest rate targeted by the Federal Reserve out of its target range.

That prompted the New York Fed to intervene in the market for the first time in a decade on Tuesday. It subsequently continued daily $75bn cash injections throughout last week.

Monday’s auction showed reduced demand from banks for cash from the New York Fed, as the strain in the repo market subsided. Auctions on Wednesday, Thursday and Friday last week all generated bids totalling more than the $75bn cap.

On Friday, the New York Fed also announced plans to provide up to $90bn in two week-long loans in anticipation of further stress at the end of the September quarter.

“The goal of these actions is the same as for recent open market operations: foster conditions in money markets to keep the federal funds rate within the target range,” John Williams, New York Fed president, said at a conference in New York on Monday.

He added: “This episode reminds us all of the importance of having well- functioning markets and the vital role that the Federal Reserve plays in supplying liquidity to the system when markets are under stress. We were prepared for such an event, acted quickly and appropriately, and our actions were successful,” reiterating remarks he gave to the Financial Times on Friday.

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“Friday’s announcement on open market operations to address potential quarter-end funding pressures on interest rates followed this same approach: quickly diagnose the problem, develop the right action plan, and execute that plan.”

Via Financial Times