NEW YORK, Oct 28 (Reuters) - The U.S. Federal Reserve's balance sheet shrank slightly in the latest week, led down by lower holdings of mortgage-backed securities and agency bonds, Fed data released on Thursday showed.
The balance sheet -- a broad gauge of Fed lending to the financial system -- shrank to $2.278 trillion in the week ended Oct. 27 from $2.288 trillion the previous week.
Fed balance sheet liabilities remain below their record high of $2.334 trillion hit in May. After declining early last year, the balance sheet surged amid the U.S. central bank's asset-buying program. For a graphic of the Fed's balance sheet, see: http://link.reuters.com/buf92k
The program, known as quantitative easing, was broadly aimed at holding down borrowing costs and supporting the ailing housing market as the economy recovered from the worst recession in 70 years.
That effort was also led by the Fed's purchases of mortgage-related securities, which came to a conclusion at the end of March.
However, the Fed took a small but significant step on Aug. 10 to counter a weakening U.S. economic recovery, saying it would use cash from maturing mortgage bonds it holds to buy more government debt. To date it has purchased over $62 billion of Treasury inflation-protected securities and Treasuries under the program.
The U.S. central bank is now widely expected to announce a further round of quantitative easing at the close of its next policy meeting on Nov. 3.
A Reuters poll Wednesday found that most leading economists expect the Fed to buy between $80 billion and $100 billion in assets per month, with totals ranging widely from $250 billion to as high as $2 trillion.
The Fed's holdings of U.S. Treasury securities rose to $837.85 billion as of Oct. 27, up from $832.12 billion the previous week.
The Fed's holdings of mortgage-backed securities backed by housing finance companies Fannie Mae and Freddie Mac totaled $1.051 trillion on Oct. 27, down from $1.066 trillion the previous week.
The U.S. central bank's ownership of debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Bank System was $149.68 billion on Oct. 27, down from $150.74 billion the previous week.
Primary credit via the Fed's discount window averaged $24 million per day in the latest week versus $32 million per day in the previous week.
(Reporting by Chris Reese: ) Keywords: USA FED/DISCOUNT (chris.reese@thomsonreuters.com; +1 646 223 6073; Reuters Messaging: chris.reese.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The balance sheet -- a broad gauge of Fed lending to the financial system -- shrank to $2.278 trillion in the week ended Oct. 27 from $2.288 trillion the previous week.
Fed balance sheet liabilities remain below their record high of $2.334 trillion hit in May. After declining early last year, the balance sheet surged amid the U.S. central bank's asset-buying program. For a graphic of the Fed's balance sheet, see: http://link.reuters.com/buf92k
The program, known as quantitative easing, was broadly aimed at holding down borrowing costs and supporting the ailing housing market as the economy recovered from the worst recession in 70 years.
That effort was also led by the Fed's purchases of mortgage-related securities, which came to a conclusion at the end of March.
However, the Fed took a small but significant step on Aug. 10 to counter a weakening U.S. economic recovery, saying it would use cash from maturing mortgage bonds it holds to buy more government debt. To date it has purchased over $62 billion of Treasury inflation-protected securities and Treasuries under the program.
The U.S. central bank is now widely expected to announce a further round of quantitative easing at the close of its next policy meeting on Nov. 3.
A Reuters poll Wednesday found that most leading economists expect the Fed to buy between $80 billion and $100 billion in assets per month, with totals ranging widely from $250 billion to as high as $2 trillion.
The Fed's holdings of U.S. Treasury securities rose to $837.85 billion as of Oct. 27, up from $832.12 billion the previous week.
The Fed's holdings of mortgage-backed securities backed by housing finance companies Fannie Mae and Freddie Mac totaled $1.051 trillion on Oct. 27, down from $1.066 trillion the previous week.
The U.S. central bank's ownership of debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Bank System was $149.68 billion on Oct. 27, down from $150.74 billion the previous week.
Primary credit via the Fed's discount window averaged $24 million per day in the latest week versus $32 million per day in the previous week.
(Reporting by Chris Reese: ) Keywords: USA FED/DISCOUNT (chris.reese@thomsonreuters.com; +1 646 223 6073; Reuters Messaging: chris.reese.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.