This week the Fed’s own holdings of MBS were unchanged, having been nearly unchanged last week. This seems a bit fruity, but perhaps is a signal that all the pending stuff has now closed and we won’t see a change again until they start selling these holdings. Foreign central banks sold a huge amount of obligations this week, having bought a gigantic amount the week before. Without transparency this sloshing about is getting a bit unnerving.

This week’s Reuters report¹ was, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.² Here is Doom’s updated CSV version³ of the agencies and treasuries foreign central bank holdings data set (includes FedMBS).

The cenbank treasuries holdings paused a bit this week from the recent moon shot.

I’m not sure how we managed to make these thumbnails so small, but if you click on them the full-sized images are OK.  (ah, the joys of WordPress ) After blasting up $24.4B last week, Treasury Debt holdings eased back down $3.498 billion.

Agencies plunged $7.531 billion

*Agen-FM: The dotted line is the foreign central banks’ Agency Debt holdings reduced by the level of the Fed’s own MBS holdings. Since the FRBNY itself is a lightly audited peculiar amalgam of foreign & domestic, central and private bank I think it might be useful to consider the hypothesis that for a while starting in January 2009 the Fed’s MBS holdings were being quietly deemed to be “foreign.” That is, for the first half of ’09 the dotted line seems more sensible than the red one.

This week saw a net collapse of $11.029 billion, but last week’s buy was about 2 1/2 times that size.

Twist’s ratios graphs continued down at a slower pace.

The Setser components didn’t move much, as we’re on the anniversary of a similar result.

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Notes and References

[1]: “Foreign cenbank U.S. debt holdings fall – Fed”, by Burton Frierson, Reuters, September 9, 2010.

[2]: “H.4.1 Factors Affecting Reserve Balances”, Federal Reserve Statistical Release (weekly), Federal Reserve Bank of New York.

[3]: The updated data set as a Comma Separated Value (CSV) file is here (includes Fed’s own MBS holdings).

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