Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/262048 
Year of Publication: 
2021
Series/Report no.: 
Staff Report No. 998
Publisher: 
Federal Reserve Bank of New York, New York, NY
Abstract: 
In March 2020, massive customer selling of U.S. Treasury securities and agency mortgage-backed securities (MBS) triggered by the COVID-19 pandemic overwhelmed dealers' capacity to intermediate trades, contributing to a marked deterioration of market functioning. The Federal Reserve promptly took numerous steps to address the market disruptions, including the initiation of market functioning purchases of Treasury securities and agency MBS. Purchases quickly expanded to over $100 billion per day as the Fed announced plans to buy securities "in the amounts needed" to support market functioning and the effective transmission of monetary policy. Market liquidity improved steadily after mid-March, suggesting that the Fed's efforts were effective, and the security purchases were scaled back accordingly.
Subjects: 
Federal Reserve
asset purchases
Treasury securities
agency mortgage-backed securities
COVID-19
JEL: 
E53
E44
G12
G01
Document Type: 
Working Paper

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