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Federal Reserve Watch: Balance Sheet Has Increased By $2.5 Trillion

May 03, 2020 11:36 AM ET10 Comments
John M. Mason profile picture
John M. Mason


  • The latest Federal Reserve statistics show that the Fed's balance sheet has increased by $2.5 trillion since the banking week ending February 26, 2020.
  • The Fed continues to buy Treasury securities, it bought $62.0 billion this last banking week, as the government deposits at the Fed continue to build as Treasury checks are written.
  • Swap agreements with other central banks around the world continue to rise as the Fed works with others to keep things calm in world banking and financial markets.

The Federal Reserve, according to the Fed’s H.4.1 statistical release Factors Affecting Reserve Balances at Depository Institutions, added $81.8 billion to its balance sheet in the banking week ending April 29, 2020.

This brought total Federal Reserve assets up to $6.7 trillion.

Reserve balances with Federal Reserve banks, basically the excess reserves in the banking system, rose by $63.5 billion to bring this total up to just under $3.2 trillion.

Since the banking week ending February 26, 2020, the time when Federal Reserve policy shifted into its present operating stance, the Fed has added $2.5 trillion to its asset total.

Reserve balances with Federal Reserve banks have risen by just under $1.5 trillion sine February 26.

Since February 26, the Federal Reserve opened up a series of accounts that are being used to support banks and securities dealers as well as the Paycheck Protection Program (PPP) and has added $126.5 billion to the financial system to provide needed liquidity in the money markets and in the economic system.

The Federal Reserve continues to support central banks around the world. The Fed has provided liquidity swaps to other central banks of $439.0 billion since February 26.


Since February 26, the Federal Reserve has purchased a lot of government securities, as it said it would

Just this past banking week, the Fed purchased $62.0 billion of Treasury securities, upping the total amount it has bought since February 26 to just under $1.5 trillion.

Just a note of reminder: in August 2008, just before the start of the Great Recession, the total assets held by the Federal Reserve totaled only around $950.0 billion. This gives us some idea of the magnitude of what Federal Reserve officials are now doing.

Furthermore, since February 26, the Federal Reserve had added $232.2 billion in mortgage-backed

This article was written by

John M. Mason profile picture
John M. Mason writes on current monetary and financial events. He is the founder and CEO of New Finance, LLC. Dr. Mason has been President and CEO of two publicly traded financial institutions and the executive vice president and CFO of a third. He has also served as a special assistant to the secretary of the Department of Housing and Urban Development in Washington, D. C. and as a senior economist within the Federal Reserve System. He formerly was on the faculty of the Finance Department, Wharton School, the University of Pennsylvania and was a professor at Penn State University and taught in both the Management Division and the Engineering Division. Dr. Mason has served on the boards of venture capital funds and other private equity funds. He has worked with young entrepreneurs, especially within the urban environment, starting or running companies primarily connected with Information Technology.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (10)

What level of Federal Reserve securities held indicates complete failure of the financial system?
Robert Claassen profile picture
As of Thursday the 29th, foreign central banks had borrowed approximately US$450 on the Fed swap lines. When that is unwound, that will be a lot of $ buying pressure. Effectively the Fed is acting as the world's central bank ... a questionable move in my view. I think if the American people knew their central bank had just extended such massive loans to foreign countries, they wouldn't support it. Maybe market participants approve (as you suggest), but that isn't supposed to be the Fed's constituency.
Me XMan profile picture
Fed can buy until end of earth right?
@Me XMan
Indeed, as long as the printing press doesn't break. Appears neither the GOP or Dems have any interest in stopping the presses any time soon.
Me XMan profile picture
@nopilikia I thought is independent unit from the Congress. GOP and Dems can stop Fed? Interesting.
Oh the Fed is independent. Just Congress has spent like crazy since 2009 and appears content to do so for the foreseeable future. The Fed seems o.k. to just let it go. And the National Debt just keeps growing by leaps and bounds.
Plus if I were China, I would take profits and quietly reduce US Treasuries balance, shouldn't threaten not to pay interest, not much of that at current rates anyway, more for the FED to buy. And buy even more gold, probably a better long term play anyway.
Ah ONLY over $24,945,231,000,000, no worries mate. Necessary to spend now to keep the economy and those living stimulus/unemployment check to check alive in the ICU though.
What is a few TRILLION among friends? The FED will probably have to buy more and more Treasuries in the future when flight to safety eases to keep interest rates reasonable for Treasury. Hope the government penchant to spend more than it takes in eases as the economy improves, unlikely as that is.
Print and spend. The on going eleven year policy of the Fed to save America's big banks and large corporations is once again in full swing. One has to really start wondering how long the world's reserve currency status for the U.S. dollar lasts. Hopefully Americans run will last at least as long as Spain's did.
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