Keeping you up to date on the latest data releases.
- The Federal Reserve Balance Sheet
The Maturity Extension Program began in October. The Fed started selling short-term (1- to 3-year) Treasury securities and purchasing long-term (7- to 30-year) Treasury securities. In addition, the reinvestment of principal payments on agency debt and agency mortgage-backed securities (MBS) has been reinvested in agency MBS. The European Central Bank expanded their drawings on their dollar liquidity swap over the month of October. On top of the $500 million, 7-day draw the ECB had been making, they added an 84-day swap for $1.353 billion. In late October, the Maiden Lane portfolios were revalued according to current market values. All three portfolios lost value. Maiden Lane I went from $14.5 billion to $12.9 billion, Maiden Lane II went from $9.9 billion to $9.5 billion, and Maiden Lane III dropped from $20.4 billion to $18.0 billion. Perhaps an interesting side effect of the recent balance sheet operations, the amount of securities lent to dealers reached its lowest point of 2011 over the past week, below $10 billion lent.