Fed prepared to adjust balance sheet size and composition
Minutes reveal discussions of how the Fed could use its balance sheet in long-run
The Federal Reserve is prepared to adjust the size and composition of its balance sheet again to give itself more room for monetary stimulus if faced with the zero lower bound.
Federal Open Market Committee (FOMC) members discussed two long-term balance sheet scenarios that could facilitate monetary easing and tightening capabilities in the future, minutes published on May 22 reveal.
The first, a proportional-maturity balance sheet, is what the Fed is roughly operating with at present, while a
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