Time to shrink Fed’s $4.5 trillion balance sheet, say presidents
The president of the Federal Reserve Bank of Cleveland has said she would be “comfortable” changing the Fed’s reinvestment policy this year to begin shrinking its balance sheet.
“Ending reinvestment is a first step toward reducing the size of the balance sheet and returning its composition to primarily treasury securities,” Loretta Mester said, presenting a lecture in Richmond on March 21.
The Fed’s balance sheet currently stands at $4.5 trillion. “The FOMC [Federal Open Market Committee] is
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