Fed, Balance Sheet
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As Wall Street's expectations have rapidly shifted toward an imminent end to the Federal Reserve's effort to shrink its bond holdings, some analysts also anticipate a return to balance sheet expansion in relatively short order.
Discussions about an optimal size of the Fed’s balance sheet are increasingly at odds with the diverse drivers of how this ledger interacts with a shifting regulatory environment.
Yesterday, ahead of the Federal Reserve's Federal Open Market Committee meeting, Senator Rick Scott sent a letter to Federal Reserve Chair Jay Powell urging him not to halt the Fed's ongoing balance sheet reduction.
The Federal Reserve on Wednesday said it will stop shrinking its Treasury holdings beginning Dec. 1, ending a three-year long effort after stress signals in money markets intensified in recent days.