After the US banking crisis broke out, the Federal Reserve restarted its money printing machine, and its balance sheet increased by US$300 billion from US$8.39 trillion on the 8th to US$8.69 trillion on the 15th. The latest data shows that the Federal Reserve has expanded its balance sheet once more in the last week. As of the 21st, the size of the Fed’s balance sheet has increased by another US$43 billion to US$8.733 trillion.
(Recap:Powell: US $300 billion balance sheet expansion “has nothing to do with monetary policy”, it is necessary that the Fed will continue to raise interest rates!）
(background supplement:Worse than the financial tsunami.” Bank of America “loaned more than 160 billion magnesium” from the Fed in a week, and the Fed will print another 300 billion magnesium）
sinceAfter a series of thunderstorms at many banks in the United States this month caused turmoil in the global financial market, the Federal Reserve (Fed) urgently moved out the new rescue tool “Bank Term Financing Program” (BTFP). In just one week, the bank has since The program borrowed $11.9 billion and borrowed $152.85 billion from the discount window.
At the same time, the US Federal Reserve (Fed) also restarted the money printing machine, and the Fed’s balance sheet increased by US$300 billion from US$8.39 trillion on March 8 to US$8.69 trillion on March 15. It was the largest weekly increase since the pneumonia epidemic, and the size of the balance sheet also hit the highest level since November last year.
The Fed expands its balance sheet once more
It is worth noting that, according to the latestdataIt shows that the Federal Reserve has expanded its balance sheet once more in the last week. As of March 21, the size of the Fed’s balance sheet has grown to 8.733 trillion U.S. dollars, which has further increased by regarding $43 billion.
The Federal Reserve has started shrinking its balance sheet since June last year. It can be seen from the balance sheet change chart that since June last year, the size of the Federal Reserve’s balance sheet has gradually decreased from nearly 9 trillion US dollars, but since the 8th of this month Instead, the size of the Fed’s balance sheet expanded by $343 billion, and the Fed’s efforts to shrink its balance sheet in recent months were in vain.
Powell stresses: no intention to change monetary policy
However, on the 22nd, Ball hademphasizefollowing the collapse of Silicon Valley Bank, although the Fed’s efforts to shrink its balance sheet have reversed sharply, it does not mean that the Fed is directly changing its monetary policy stance:
The expansion of the balance sheet, effectively temporary lending to the banks, the Fed has no intention of directly changing the monetary policy stance… We haven’t really discussed changing the implementation of the balance sheet, but if we think a change is appropriate, there will always be Willing to make a difference.
Further reading:Powell: US $300 billion balance sheet expansion “has nothing to do with monetary policy”, it is necessary that the Fed will continue to raise interest rates!
Subadra Rajappa, head of U.S. rates strategy at Societe Generale analyzethe Federal Reserve’s move to support the U.S. banking industry has obviously expanded the size of the balance sheet. If the use of liquidity tools provided by the Fed is small and controlled, the Fed is expected to continue to implement quantitative tightening, but if If it is used extensively, quantitative tightening may be called to a halt, as it will raise concerns regarding a shortage of reserves.
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