MNI POLICY: Fed Assets Up $6B to $7.0T; Main Street Aid Flat

By Evan Ryser

     WASHINGTON (MNI) - The Fed's balance sheet remained on an even keel over

the last week, data released Thursday showed, as "Main Street" lending stalled.

     The Fed's portfolio grew USD6 billion to USD6.96 trillion. Growth in

Treasuries and MBS were mostly offset as liquidity swaps kept rolling off. 

     Holdings of Treasuries increased by USD13 billion and holdings of

mortgage-backed securities grew by USD22 billion.

     FX swaps continued to roll off, with a weekly decrease of USD33 billion to

USD122 billion, down from highs of USD450 billion in late May.

     -- MAIN STREET

     The Fed's Main Street facility grew by USD2 million over the prior week,

the data showed when controlled for Treasury contributions. That was down from

USD12 million in take up last week when the facility first became operational.  

     Usage of the Fed's emergency 13(3) liquidity facilities generally remained

flat or declined. 

     Purchases of corporate bonds continued at a USD123 million daily average,

but down from highs of USD300 million per day. The central bank has purchased a

total of USD2 billion in corporate bonds. 

--MNI Washington Bureau; +1 202 371 2121; email: evan.ryser@marketnews.com

[TOPICS: MMUFE$,M$U$$$]