by Wolf Richter • May 2, 2024
Quantitative Tightening has removed 38% of Treasury securities and 27% of MBS that pandemic QE had added.
By Wolf Richter for WOLF STREET.
Total assets on the Fed’s balance sheet fell by $77 billion in April, to $7.36 trillion, the lowest since December 2020, according to the Fed’s weekly balance sheet today. Since the end of QE in April 2022, the Fed has shed $1.60 trillion.
After months of talking about it, the Fed has now clarified officially when, how, and by how much it will slow QT. They’re trying to get the balance sheet down as far as possible without blowing anything up, and easy will do it, that’s the hope.
Starts in June
Cap for Treasury runoff reduced to $25 billion from $60 billion
Cap for MBS runoff unchanged at $35 billion