The Fed’s Balance Sheet Reduction (QT) Update

The Fed is going through the motions with its muted QT effort at a time when it will soon lower its Fed Funds rate. The Fed’s monetary policy is caught in a vicious circle of inflating and deflating bubbles, only this most recent “everything bubble” did not exactly fully deflate given that Powell treated price inflation with kid gloves. This next inflation cycle will further devalue the Dollar.

• Treasuries: The Fed’s Treasury security holdings declined by $10 billion for the week-ended September 4th. The Fed’s Treasury holdings declined by $25.0 billion on a rolling 4-week basis.

• Agencies: The Fed’s Government Agency security holdings were unchanged for the week-ended September 4th and declined by $18.4 billion on a rolling 4-week basis.

• The Fed’s balance sheet holdings: https://www.newyorkfed.org/markets/soma-holdings