Federal Reserve Balance Sheet Update: Week Of February 25 - Just $45 Billion Left In Quantitative Easing

The Federal Reserve's assets were at $2.27 trillion as of February 25, jumping by $6 billion sequentially. 

  • Securities held outright: $1,975 billion (an increase of $62.6 billion MoM, resulting from $59 billion increase in MBS and $3 billion in Agency Debt), or $8 billion increase sequentially. 
  • The fed has completed $169.1 billion of $175 billion in the agency MBS program, or a 97% completion, and 96% complete with purchases of Agencies. The Fed has completed $1.21 trillion of its $1.25 trillion MBS debt purchase program, or 97%, through February 25. There is now just $45 billion left before Quantitative Easing is over.
  • Net borrowings: $103 billion. The monetary base increased by $81 billion in the past fortnight to $2.14 trillion. The ratio of total assets to Monetary Base declined slightly to 1.06x.
  • Float, liquidity swaps, Maiden Lane and other assets: $191 billion. The CPFF program was at $7.7 billion. FX liquidity swaps are now at zero: we are carefully keeping an eye on this metric as any increase presently would indicate banks are again experiencing a dollar funding shortage. Maiden Lane I and Maiden Lane II increased and were $27.2 and $15.5 billion, while Maiden Lane III as always continues pretending it has value and came flat at $22.4 billion.

Custody foreign securities holdings increased by $5.6 billion to $2,964 billion.

The Fed extended the duration of its holdings over the past two weeks. The chart below demonstrates the most recent maturity distribution of Fed Assets as of February 25.

The change is presented below: Approximately $30 billion in Under 15 day maturiting securities rolled, of which Term Auction Credit was the biggest constituent. The biggest increase was in MBS, for almost $60 billion over the past two weeks, all of it naturally in the over 10 year category.

The Atlanta Fed provides the following breakdown of the most recent Fed balance sheet activity. Note to dramatic reduction in TALF activity.