Federal Reserve Holds $2.6 Trillion in Residential MBS at the End of 2021
Posted on 12/31/2021
The U.S. Federal Reserve held US$ 2,635,024,000,000 in mortgage-backed securities at December 29, 2021, a US$ 568,615,000,000 increase from December 30, 2020.
Of that amount, US$ 2,606,255,000,000 is held in residential mortgage-backed securities (MBS). According to the Urban Institute, as of November 2020, agency MBS made up 97.27% of the residential mortgage market. The Federal Reserve quickly responded to massive financial market volatility at the onset of the COVID-19 pandemic in March 2020, providing stability in a variety of ways. This included large-scale purchases of U.S. Treasuries and agency MBS. As the largest buyer and holder of agency mortgage-backed securities, the Federal Reserve is able to keep its thumb on mortgage rates. The central bank purchased a total US$ 580 billion in agency MBS during the two-month period of March 2020 and April 2020.
Total assets of the Federal Reserve’s balance sheet reached US$ 8,757,460,000,000.
Keywords: Federal Reserve System.
