The Federal Reserve's repurchase agreement is its core tool for adjusting short-term liquidity. During operations, the Fed buys securities such as government bonds from dealers and agrees to repurchase them in the future (repurchase agreement), which is essentially short-term lending to release funds; upon maturity, securities are sold back to recover funds (reverse repurchase). When market funds are tight or excessive, precise adjustments are made through repurchase and reverse repurchase agreements to stabilize interest rate fluctuations and maintain financial stability. This is an important regulatory measure in both daily operations and during crises.