Permanent Open Market Operations
|Purchases or sales of securities on an outright basis that add or drain reserves and change the size or the composition of the System Open Market Account (SOMA) portfolio are among the tools used by the Federal Reserve to implement monetary policy.|
Purchases or sales of Treasury securities on an outright basis have been used historically to manage the supply of reserves in the banking system. Traditionally, purchases of Treasury securities for the SOMA were conducted to offset factors that permanently drain balances from the banking system, including U.S. currency in circulation, among other factors. These actions would be taken to maintain conditions in the market for bank reserves consistent with the federal funds target rate set by the Federal Open Market Committee (FOMC).
In recent years, the FOMC has directed the Desk to change the size or the composition of the SOMA's Treasury portfolio in order to influence longer-term interest rates and support broader financial conditions.
Cumulative Purchases and Sales under the Maturity Extension Program
In recent years, the FOMC has directed the Desk to purchase agency MBS in order to put downward pressure on longer-term interest rates, support mortgage markets and help to make broader financial conditions more accommodative.
Agency MBS Transaction Summary ››
Agency MBS Historical Operational Results and Planned Purchase Amounts ››
FAQs: Agency MBS Purchases ››
FAQs: Agency MBS CUSIP Aggregation ››
Small Value Exercise: Agency Mortgage-Backed Securities ››