Authors: Stefania D'Amico, Max Gillet, Sam Schulhofer-Wohl, and Tim Seida
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Staff Reports
Open-Ended Treasury Purchases: From Market Functioning to Financial Easing
Number 1183
February 2026
February 2026
JEL classification: E43, E44, E52, E58
We assess whether the Fed’s asset purchases can be tailored to either restore market functioning or provide economic stimulus. When the communicated goal is restoring market functioning and purchases’ implementation is flexible, flow effects are significant: relative price deviations narrow. However, stock effects remain near zero and hence not stimulative. When the communicated goal links purchases to the achievement of the dual mandate, improving their size’s predictability, stock effects rise consistently above zero. When the communicated implementation improves the predictability of the purchases’ maturity composition, stock effects become large. Jointly, the communicated goal and implementation can shape the purchases’ effects.
Author Disclosure Statement(s)
Stefania D’Amico
The author (Stefania D’Amico) declares that she has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
Max Gillet
The author declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
Sam Schulhofer-Wohl
The author declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy.
Tim Seida
The author (Tim Seida) declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
The author (Stefania D’Amico) declares that she has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
Max Gillet
The author declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
Sam Schulhofer-Wohl
The author declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy.
Tim Seida
The author (Tim Seida) declares that he has no relevant or material financial interests that relate to the research described in this paper. Prior to circulation, this paper was reviewed in accordance with the Federal Reserve Bank of New York review policy, available at https://www.newyorkfed.org/research/staff_reports/index.html.
Suggested Citation:
D’Amico, Stefania, Max Gillet, Sam Schulhofer-Wohl, and Tim Seida. 2026. “Open-Ended Treasury Purchases: From Market Functioning to Financial Easing.” Federal Reserve Bank of New York Staff Reports, no. 1183, February. https://doi.org/10.59576/sr.1183
D’Amico, Stefania, Max Gillet, Sam Schulhofer-Wohl, and Tim Seida. 2026. “Open-Ended Treasury Purchases: From Market Functioning to Financial Easing.” Federal Reserve Bank of New York Staff Reports, no. 1183, February. https://doi.org/10.59576/sr.1183
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