Fed's Powell Says Treasury Purchases May Remain Elevated

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Transcript

00:00The Committee judged that reserve balances have declined to ample levels.

00:05Accordingly, at today's meeting, the Committee decided to initiate purchases of shorter-term Treasury securities, mainly Treasury bills,

00:12for the sole purpose of maintaining an ample supply of reserves over time.

00:16Such increases in our securities holdings ensure that the federal funds rate remains within its target range

00:22and are necessary because the growth of the economy leads to rising demand over time for our liabilities,

00:28including currency and reserves.

00:31As detailed in a statement released today by the Federal Reserve Bank of New York,

00:36reserve management purchases will amount to $40 billion in the first month

00:40and may remain elevated for a few months to alleviate expected near-term pressures in money markets.

00:46Thereafter, we expect the size of reserve management purchases to decline,

00:50though the actual pace will depend on market conditions.