$7.9 Billion POMO Closes As Fed Ties China For Top Global Holder Of US Treasurys With $868 Billion
Today's $7.9 billion POMO is now history, closing at a surprisingly low 3.5x submitted to accepted ratio. What this does to stocks will be closely watched as Friday's POMO was a failure. Two red days on POMO in a row will be the wrong signal the FRBNY will want to send to the Fed frontrunners. More importantly, today's POMO in addition to last Friday's $7.2 billion monetization, adds to the Fed's total UST holdings of $853 billion as of last Wednesday, meaning the Fed has now tied China for top holder of US Treasury securities, both of which have $868 Billion in holdings. Tomorrow's POMO will make the Fed the top holder of USTs in the world, or at least until the next TIC announcement (also tomorrow) which will show that China's UST holdings as of September very likely grew by another $15-20 billion. Nonetheless, with a run rate of $7 billion in daily monetizations, the Fed will overtake that number by the end of the week as well.