Increase in Fed balance sheet

April 3rd, 2023, 02:29 PM

Has anybody noticed the increase in the Fed balance sheet in the past few weeks? Looks like the balance sheet increased a little over $300B. My question is, is this increase because the Fed wants to keep the rates on long bonds down? If so, is the Fed doing this to prevent the bonds on bank balance sheet from decreasing in value? What are your thoughts?

-Blackgrey45

April 8th, 2023, 06:38 PM

it is unlikely the FED would have raised interest rates in the last meeting , if the intention was to keep rates down on the long end of the curve . This was just after the banks flopped . The balance sheet increase was likely the result of loaning other Banks 100 s of billions to make sure the Bank runs on deposits was over , along with bailing out the depoisters of failed banks . hope it helps .

Increase in Fed balance sheet

Discussion in Treasury Notes and Bonds

Increase in Fed balance sheet