The Feds balance sheet expanded in the latest week, with rising to $2.265 trillion from $2.262 trillion. With direct bank lending continuing to decline and central bank liquidity swaps returning to zero, the bulk of the increase came from the Fed’s purchases of long-term securities. More than $23 billion in new purchases of mortgage-backed securities was added to the balance sheet. The Fed expects to wind down these purchase by the end of the month.
In an effort to track the Fed’s actions, Real Time Economics has created an interactive graphic that will mark the expansion of the central bank’s balance sheet. The chart will be updated as often as possible with the latest data released by the Fed.
In an effort to simplify the composition of the balance sheet, some elements have been consolidated. Portfolios holding assets from the Bear Stearns and AIG rescues have been put into one category, as have facilities aimed at supporting commercial paper and money markets. The direct bank lending group includes term auction credit, as well as loans extended through the discount window and similar programs.
Central bank liquidity swaps refer to Fed programs with foreign central banks that allow the institutions to lend out foreign currency to their local banks. Repurchase agreements are short-term temporary purchases of securities from banks, which are looking for liquidity and agree to repurchase them on a specified date at a specified price.
Click and drag your mouse to zoom in on the chart. Clicking the check mark on categories can add or remove elements from the balance sheet.