Assessing Market Conditions ahead of Quantitative Tightening
Abstract: Quantitative tightening (QT)—the reduction in the Federal Reserve’s balance sheet—will transfer a significant amount of Treasury and agency mortgage-backed securities to investors. This transfer will be larger than the first endeavor with QT in 2017 and will occur at a time when financial markets are strained, suggesting this round of QT has the potential to be more disruptive compared with the benign start to the 2017 runoff.
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Provider: Federal Reserve Bank of Kansas City
Part of Series: Economic Bulletin
Publication Date: 2022-07-11
Issue: July 11, 2022