Discussion Paper

A Decomposition of Balance Sheet Reduction


Abstract: Since the Global Financial Crisis, central banks have used the size and composition of their balance sheets to influence financial conditions and economic activity when policy rates are constrained by the effective lower bound. A common measure of the size of the Federal Reserve's balance sheet is the System Open Market Account (SOMA) securities holdings expressed as a share of nominal gross domestic product (NGDP).

https://doi.org/10.17016/2380-7172.3968

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Provider: Board of Governors of the Federal Reserve System (U.S.)

Part of Series: FEDS Notes

Publication Date: 2026-02-02

Number: 2026-02-02