Fed Assets Rise to Record $2.54 Trillion on Treasury Purchases
The Federal Reserve’s total assets rose by $24.5 billion to $2.54 trillion, the fourth record in as many weeks, as the central bank bought Treasury securities in a second round of quantitative easing aimed at spurring economic growth and reducing unemployment.
Treasuries held by the Fed rose by $23.1 billion to $1.21 trillion as of yesterday. The Fed’s holdings of mortgage-backed securities fell by $243 million to $958.2 billion and federal agency debt fell by $246 million to $144.1 billion, according to a weekly release by the central bank today.
The central bank has purchased $366.3 billion in Treasuries since Nov. 12 under plans to purchase $600 billion of government debt through June and reinvest proceeds from maturing mortgage debt. The unconventional monetary easing is aimed at spurring economic growth and preventing inflation from falling too low.
M2 money supply rose by $8.4 billion in the week ended Feb. 14, according to the Fed. That left M2 growing at an annual rate of 3.8 percent for the past 52 weeks, below the target of 5 percent the Fed once set for maximum growth. The Fed no longer has a formal target.
The Fed reports two measures of the money supply each week. M1 includes all currency held by consumers and companies for spending, money held in checking accounts and travelers checks. M2, the more widely followed, adds savings and private holdings in money market.
M1 declined $8.6 billion, and over the past 52 weeks M1 rose 9 percent, according to the central bank. The Fed no longer publishes figures for M3.
To contact the reporter on this story: Joshua Zumbrun in Washington at jzumbrun@bloomberg.net
To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net
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