According to BlockBeats reports, analysts at Morgan Stanley stated that the U.S. Federal Reserve (Fed) is nearing the end of its historical loss streak and may soon resume returning funds to the U.S. Treasury. This development is related to the Federal Reserve's financial operations and its payments to maintain control of short-term interest rates. The sharp increases in interest rates that began three years ago led to significant losses for the Federal Reserve, but with the recent decline in short-term interest rates, Morgan Stanley suggests that the Fed is approaching a critical point for profitability.
Morgan Stanley estimates that the Federal Reserve's neutral interest rate is around 4.8%. The combination of balance sheet reduction and falling political interest rates is helping the Federal Reserve move away from losses. Analysts point out that continuing to reduce bond holdings and the possibility of further rate cuts "suggest that the Federal Reserve will return to profitability."
The Federal Reserve revealed its financial position for 2024 last Friday, showing a total net loss of $77.5 billion for 2024, following a record deficit of $114.6 billion in 2023. The last time the Federal Reserve announced a profit was in 2022.
#FEDDATA #ReserveRights #news_update #Crypto_Jobs🎯