The Fed’s Balance Sheet Reduction (QT) Update
The Fed ought to ramp up QT as it lowers its Fed Funds rate. Get out of the rate setting game and instead hold the money supply steady once the Fed gets its balance sheet back down between $4-5 Trillion. Rid the balance sheet of the QE excess of 2020, 2021 and 2022.
Treasuries: The Fed’s Treasury security holdings declined by $15 billion for the week-ended August 21st. The Fed’s Treasury holdings declined by $25.3 billion on a rolling 4-week basis.
Agencies: The Fed’s Government Agency security holdings declined by $4.1 billion for the week-ended August 21st and declined by $18.1 billion on a rolling 4-week basis.
The Fed’s balance sheet holdings: https://www.newyorkfed.org/markets/soma-holdings
Excel file: Our Excel file detailing the Fed’s holdings of Treasury and Agency securities over time: HERE.
