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MNI Fed Balance Sheet Tracker: Feb 27, 2025

A pause in QT looks increasingly likely, perhaps announced by May.
USCentral Bank NewsFederal ReserveBalance Sheet AnalysisMarketsStoryNorth America

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Fed Sets Stage For QT “Pause”

  • Fed balance sheet runoff policy is set to shift in 2025 – and perhaps slightly earlier than the mid/late year dates previously anticipated. A pause in QT looks increasingly likely, perhaps announced by May.
  • We go through the current state of the Fed’s balance sheet with a stylized scenario of reserve balances over the next six months.
  • We also update on market expectations for QT’s end: while there is increasing focus on a QT pause/slowdown announced by May’s FOMC meeting, there remain some expectations that the Fed can wait until after the summer before calling time on balance sheet rundown, either temporarily or permanently. 
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Download Full Report Here

Fed Sets Stage For QT “Pause”

  • Fed balance sheet runoff policy is set to shift in 2025 – and perhaps slightly earlier than the mid/late year dates previously anticipated. A pause in QT looks increasingly likely, perhaps announced by May.
  • We go through the current state of the Fed’s balance sheet with a stylized scenario of reserve balances over the next six months.
  • We also update on market expectations for QT’s end: while there is increasing focus on a QT pause/slowdown announced by May’s FOMC meeting, there remain some expectations that the Fed can wait until after the summer before calling time on balance sheet rundown, either temporarily or permanently. 
image