Earlier we mentioned we didn't much care how this jobs report came out and after seeing the Nasdaq 100 futures down 1.6% in late pre-market trade it is now down .99%, big whoop.
However, for the first time since QT was supposed to start on June 1, we saw some serious declines in both Treasury holdings and, I suspect more importantly, Agency MBS.
First up, the largest (by far) line items in the H.4.1 report:
H.4.1
|
Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks |
August 4, 2022 |
1. Factors Affecting Reserve Balances of Depository Institutions
Millions of dollars
|
Reserve Bank credit, related items, and |
Averages of daily figures |
Wednesday |
||
|
Week ended |
Change from week ended |
|||
|
Jul 27, 2022 |
Aug 4, 2021 |
|||
|
Reserve Bank credit |
8,847,741 |
- 18,258 |
+ 659,077 |
8,838,997 |
|
Securities held outright1 |
8,447,773 |
- 16,560 |
+ 790,576 |
8,439,018 |
|
U.S. Treasury securities |
5,727,943 |
- 5,814 |
+ 457,879 |
5,719,119 |
|
Bills2 |
326,044 |
0 |
0 |
326,044 |
|
Notes and bonds, nominal2 |
4,933,455 |
- 7,004 |
+ 396,108 |
4,924,116 |
|
Notes and bonds, inflation-indexed2 |
374,719 |
0 |
+ 25,434 |
374,719 |
|
Inflation compensation3 |
93,725 |
+ 1,190 |
+ 36,337 |
94,240 |
|
Federal agency debt securities2 |
2,347 |
0 |
0 |
2,347 |
|
Mortgage-backed securities4 |
2,717,483 |
- 10,746 |
+ 332,698 |
2,717,552 |
....MUCH MORE
And from the Federal Reserve Bank of St. Louis' FRED database:
Down $15.384 billion on the week and down $40.430 since June 1. Still far behind the idealized shrinkage of $101.31 billion (1.583 billion per day x 64 days) but going in the desired direction.
Here's the Fed's May 4 announcement of the $47.5 billion per month target for June, July, August.
Another week of $10 billion+ reduction and we will call the end to the equity rally.
Nasdaq 100 futures currently 13194.75 down 0.99%; S&P futures 4136.75
