Fed's balance sheet size to exceed $10 trillion by the end of 2021


The US Federal Reserve's (Fed) balance sheet is likely to exceed $10 trillion by the end of 2021, according to analysts at Morgan Stanley. 

The central bank has expanded its balance sheet by over $3 trillion to $7.10 trillion in the past 3.5-month to help the economy and credit markets absorb the shock arising from the coronavirus outbreak. More importantly, the Fed is unlikely to shift away from the ultra-accommodative stance anytime soon. 

"In this cycle, the Fed's balance sheet will expand more than it did during QE1, Q2, and Q3," said Morgan Stanley.

Balance sheet expansion could bode well for gold and weigh over the US dollar. 


 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD corrects higher during the American session, remains bearish

The EUR/USD is falling on Tuesday, on its way to the lowest daily close in a month, clearly below 1.1300. The dollar remains strong ahead of the FOMC meeting and amid volatility and risk aversion across financial markets. 

EUR/USD News

GBP/USD consolidates daily losses near mid-1.3400s

GBP/USD fell to its weakest level in three weeks below 1.3450 on Tuesday and seems to be having a difficult time staging a convincing rebound. Safe-haven flows continue to dominate the financial markets following the mixed data releases from the US.

GBP/USD News

Gold hits levels above $1850 for the first time in two months and retreats

A quick drop in US yields boosted XAU/USD that jumped from $1840 to $1853, reaching the highest level since November 19. It then pulled back all the way to $1840 and now is approaching the $1850 area again.

Gold News

Shiba Inu hits point of max pain, targets $0.000035

A brief technical and on-chain analysis on Shiba Inu price. FXStreet's analysts evaluate why SHIB could have bottomed out. 

Read more

Activision Blizzard dips lower ahead of Microsoft earnings call

Activision Blizzard could see its games thrust into the mainstream spotlight. Microsoft is set to release its FY2022 Q2 earnings on Tuesday after the close.

Read more

Forex MAJORS

Cryptocurrencies

Signatures