Fed says reserves are ample and will buy T-bills to maintain a buffer
Feb 23rd 2026
The FOMC judged reserves ample in December 2025 and directed the New York Fed to make monthly Treasury bill purchases so the Fed can steer short-term rates with administered rates rather than daily operations.
- In December 2025 the FOMC judged bank reserve balances to be at an ample level and ordered reserve management purchases.
- Ample reserves let the Fed control the federal funds rate mainly by changing administered rates like IORB and ON RRP instead of daily open market operations.
- The Desk will start with about $40 billion of Treasury bill purchases in the first month and will publish monthly planned purchases to keep reserves in the target range.
- Fluctuations in currency demand and the Treasury General Account move reserves up or down without changing total Fed assets, with average weekly TGA swings near $57 billion over five years.
- These monthly buys are routine balance sheet maintenance, not quantitative easing, intended to limit short-term money market volatility such as the spikes seen in September 2019.