Hi again! QT mechanics should get fairly vanilla soon. There is still some MBS to settle and even a little more to be purchased/reinvested but the largest impact of lagging MBS settlement is behind us. With the upcoming ramp in roll-off caps to 60b in UST and 35b in MBS (which will very likely never be hit) starting in September, I thought one last post with detailed projections and explanations for the FED SOMA Holdings/Balance sheet through the end of the year (and as a bonus also for next week) would be helpful. So lets dive in.
Hi John, Great post. Thought I'd offer a resource to satisfy your intellectual curiosity on how Fed manages roll over process.
https://www.newyorkfed.org/markets/treasury-rollover-faq
Awesome! Thank you very much Dan. Fills in a few last details.