FOMC Communications Related to Policy Normalization
On October 11, 2019, the FOMC released a statement that outlined its plans to ensure that the level of reserves in the banking system remains ample.
At the conclusion of its July 2019 meeting, the FOMC announced that it intended to cease the runoff of its securities portfolio, noting that beginning in August 2019, principal payments received from agency debt and agency MBS up to $20 billion per month would be reinvested in Treasury securities to roughly match the maturity composition of Treasury securities outstanding; principal payments in excess of $20 billion per month would continue to be reinvested in agency MBS. Also beginning in August, all maturing Treasury securities in the SOMA portfolio would be rolled over at Treasury auctions following usual practices.
At the conclusion of the March 2019 FOMC meeting, the FOMC issued a Statement of Balance Sheet Normalization Principles and Plans that provided information regarding its plans for the size of its securities holdings and the transition to the longer-run operating regime.
Following its January 2019 FOMC meeting, the FOMC issued a Statement Regarding Monetary Policy Implementation and Balance Sheet Normalization, which stated that the Federal Reserve intends to continue to implement monetary policy in a regime with an ample supply of reserves and in which control over the level of the federal funds rate and other short-term interest rates is exercised primarily through the setting of the Federal Reserve's administered rates, and in which active management of the supply of reserves is not required.
FOMC Discussions Leading to the Statement Regarding Monetary Policy Implementation and Balance Sheet Normalization and to the Balance Sheet Normalization Principles and Plans
- Minutes of the Federal Open Market Committee, November 7-8, 2018
- Minutes of the Federal Open Market Committee, December 18-19, 2018
- Minutes of the Federal Open Market Committee, January 29-30, 2019
- Minutes of the Federal Open Market Committee, March 19-20, 2019