Wall Street Adjusts Timeline for Fed's Balance Sheet Drawdown - PRESS AI WORLD
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Wall Street Adjusts Timeline for Fed's Balance Sheet Drawdown

share-iconThursday, January 09 comment-icon3 weeks ago 11 views
News sources:
reutersREUTERS
Wall Street Adjusts Timeline for Fed's Balance Sheet Drawdown

Credited from: REUTERS

  • Wall Street's major banks have delayed the expected completion date for the Federal Reserve's balance sheet reduction.
  • Minutes from the December Federal Open Market Committee revealed that banks now anticipate the drawdown to finish in June 2025, a shift from previous predictions.
  • The Fed has been conducting quantitative tightening to reduce its asset holdings, which peaked at $9 trillion during the COVID-19 pandemic.
  • Despite not announcing new details regarding the balance sheet, the Fed adjusted the reverse repo facility rate to encourage cash movement into private markets.
  • Challenges, including government financing uncertainties and market volatility, complicate the Fed's approach to adjusting liquidity effectively.

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