global-rates.com – FED Interest Rates
stlouisfed.org – How will FED reduce balance sheet
newyorkfed.org – SOMA Holdings
en.wikipedia.org – SOMA @Wikipedia
federalreserve.gov – FED balance sheet overview (2020)
Hallo Traders,
Auf Seite drei des FOMC Protokolls „Minutes of the Meeting of June 14–15, 2022 Page 3“ gleich etwas verwirrend, ist doch das geläufige GDP umschrieben, dagegen die eher unbekannte Abkürzung SOMA (für: System Open Market Account) nicht ausgeschrieben. Auf den Punkt gebracht, wird unterteilt in „overnight reverse repurchase“ und „overnight private reverse repurchase“. Systembanken werden immer liquide gehalten, Privatbanken dagegen nur im Regelfall bei strategischem Bedacht.
„[…]reduction in SOMA securities[…]“
„[…]suggested that U.S. real gross domestic product (GDP) was rebounding to[…]“
Was mir, zugestandener Weise einem Lakei auf dem Gebiet der Zentralbank-Semantik, nicht verständlich wird, sind folgende (wiedersprüchliche) Passagen.
Page 3) „In accordance with the directive to the Open Market Desk, the reduction in SOMA securities holdings began in June, under the initial monthly caps on redemptions of $30 billion for Treasury securities and $17.5 billion for agency debt and agency mortgage-backed securities (MBS). Under current staff projections, the SOMA portfolio was anticipated to decline roughly $400 billion by the end of 2022.“
vs
Page 11) „Reinvest into agency mortgage-backed securities (MBS) the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency MBS received in the calendar months of June and July that exceeds a cap of $17.5 billion per month.“
Sobald ich zu einer logischen Interpretation gelangt bin, liest Du diese hier auf diesem Blog.
Weitere Details und Ausblick auf den Exchange wie immer für Premium-Mitglieder.
Bünyamin
Goody Traders,
Reading page three of the FOMC minutes „Minutes of the Meeting of June 14-15, 2022 Page 3“ confuses a bit, as the common GDP is paraphrased, while the rather unknown abbreviation SOMA (for: System Open Market Account) is not written out. In a nutshell, it is divided into „overnight reverse repurchase“ and „overnight private reverse repurchase“. System banks will therefore always be kept liquid, private banks are only kept liquid as a rule and with strategic consideration.
„[…]reduction in SOMA securities[…]“
„[…]suggested that U.S. real gross domestic product (GDP) was rebounding to[…]“
What I, admittedly a lackey in the field of central bank semantics, do not understand are the following (contradictory) passages.
Page 3) „In accordance with the directive to the Open Market Desk, the reduction in SOMA securities holdings began in June, under the initial monthly caps on redemptions of $30 billion for Treasury securities and $17.5 billion for agency debt and agency mortgage-backed securities (MBS). Under current staff projections, the SOMA portfolio was anticipated to decline roughly $400 billion by the end of 2022.“
vs
Page 11) „Reinvest into mortgage-backed securities (MBS) the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency MBS received in the calendar months of June and July that exceeds a cap of $17.5 billion per month.“
As soon as I have come to a logical interpretation, you will read it here.
More details and my outlook on the Foreign Exchange as always for Premium Members.
Sincerely Yours, Ben
