Keeping you up to date on the latest data releases.
- Federal Reserve Balance Sheet
The biggest balance sheet news of the month came on the last day of November. The Fed, along with five other central banks, announced changes to its liquidity swap arrangements. On the dollar liquidity that the Fed provides, the rate charged to other central banks is now 50 basis points over the overnight index swap rate instead of 100 basis points. For liquidity in the other currencies, the arrangements were reactivated through February 1, 2013, but the terms will only be determined if the need for those swaps arises. The change occurred after a month of elevated financial stress in Europe, and after the level of dollar liquidity swaps drawn by foreign central banks hovered around $2 billion throughout November. On the last day of November, the New York Fed added 8 banks to its reverse repurchase agreement counterparty list, including Bank of New York Mellon, Barclays, Citibank, Morgan Stanley, and Wells Fargo. Also, as part of the Maturity Extension Program, the New York Fed announced its plans to buy $45 billion in long-term Treasury securities and sell $52 billion in short-term Treasury securities. On the balance sheet, the balance of TALF loans has fallen below $10 billion for the first time since May 2009. The balance of agency mortgage-backed securities has fallen from $879 billion to $829 billion since the September Federal Open Market Committee meeting.