Fed Discount Window Weekly Update
This week’s Primary Credit activity at the Fed’s Discount Window:
This week’s primary credit balance was $1.5 billion, down from $1.7 billion a week ago.
We believe that the Fed will put its Fed Funds rate on a path to zero percent and that Fed Funds will be at 2% or below in 2025. Such a Fed policy move will help re-inflate the debt security investment portfolios of the big banks, namely BofA, which had over $100 billion of unrealized losses across its Treasury and Agency security investment portfolio at the end of the June 2024 quarter (HERE). The U.S. banking system is a mess as is monetary policy.
