On February 8, the Federal Reserve released its semi annual monetary policy report, which mentioned that the Federal Reserve continued to significantly reduce its holdings of US treasury bond bonds and institutional securities in a predictable manner. Since June 2024, the Federal Reserve has reduced its holdings of $297 billion in securities, resulting in a cumulative decrease of approximately $2 trillion in securities holdings since the start of the balance sheet reduction. The Federal Open Market Committee (FOMC) has stated its intention to maintain securities holdings at a level consistent with the efficient implementation of monetary policy under an adequate reserve requirement system. To ensure a smooth transition, the FOMC slowed down the decline in securities holdings in June 2024 and plans to stop reducing securities when reserve balances are slightly higher than what it considers to be sufficient reserves.
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