Fed Tightens Agency MBS Holdings Day After Powell Hinted At Stopping QT (Oops, They Did It Again!)

Oops, they did it again. 

After hinting on January 30th that The Fed is considering halting shrinking of its balance sheet (better known as Quantitative Tightening), The New York Fed reported yesterday that their agency mortgage-backed securities holdings had been reduced by $7 billion. Aparently, The Fed is sticking to autopilot in terms of shrinking their balance sheet, at least for the moment.

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Again, only Agency MBS was reduced in the amount of just over $7 billion. All other holdings remained the same from the previous week.

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In other words, despite the talk, talk, The Fed is continuing to drain the punchbowl.

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