FAST FIVE: Fed Balance Sheet Rises Above $7 Trillion; Bond ETF Holdings Hit $1.8 Billion
Fed Balance Sheet Rises Above $7 Trillion; Bond ETF Holdings Hit $1.8 Billion Tyler Durden Thu, 05/21/2020 – 20:26 After crossing back above the $4 trillion mark back in October 2019 in the aftermath of the JPMorgan repo bailout, also known as “No QE”, the Fed's balance sheet is nearly double that amount a little over half a year later, with the Fed reporting in its latest H.4.1 report that as of May 20, 2020, its total assets rose above $7 trillion for the first time ever, an increase of $103 billion in the past week to $7,038 billion.
Putting the increase in context, the Fed's balance sheet hit $6 trillion on April 2.
The increase was mostly the result of a $79BN increase in settled MBS purchases as well as $32BN in Treasury purchases, while there was no change in the Fed's holdings in its commercial paper facility.
As a reminder, earlier today we laid out a BofA report according to which the Fed would disclose $2.5 billion in total bond ETF holdings, and which assumed that the Fed, which unveiled a total of $305MM in the one full day after the program was launched, would now have a $2.5 billion total in holdings.
However, the actual number was notably lower at $1.8 billion, which means that in the past 5 work days, the Fed purchased $1.5 billion in ETFs, or $300MM per day, which appears to be the Fed's now daily purchases of LQD (for those curious, the total assets of LQD are $48 billion).