financetom
Economy
financetom
/
Economy
/
NY Fed's Perli says rate control toolkit can navigate lower reserve demand
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
NY Fed's Perli says rate control toolkit can navigate lower reserve demand
May 19, 2026 8:35 AM

NEW YORK, May 19 (Reuters) - A Federal Reserve Bank of New York official responsible for implementing monetary policy on Tuesday said the central bank's current rate control toolkit would still work in a system allowing banks to hold fewer reserves.

New York Fed System Open Market Account manager Roberto Perli also said the pace of future Treasury bill buying will be determined by market conditions.

"While the current implementation framework is demonstrably very effective, there is an active public debate about the quantity of reserve supply that it entails," Perli said in the text of a speech to be delivered before a conference held by the Atlanta Fed.

"The current ample reserves implementation framework is well equipped to handle a reduction in the SOMA portfolio" if there were changes in the financial system that allowed for lower levels of reserves, Perli said.

The official also said that Treasury bill buying the Fed embarked on at the close of last year to rebuild liquidity after several years of shrinking Fed holdings will be managed flexibly going forward. It has already been reduced from buying $40 billion per month to the current pace of $10 billion.

"We stand ready to adjust the pace of (Reserve Management Purchases) up or down as necessary," Perli said.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
US labor market steadily easing as job openings, resignations decline
US labor market steadily easing as job openings, resignations decline
Mar 6, 2024
WASHINGTON (Reuters) - U.S. job openings fell marginally in January, while the number of workers quitting their jobs dropped to a three-year low, indicating that labor market conditions were gradually easing. The decline in resignations, which pushed the quits rate to the lowest level in 3-1/2 years, over time bodes well for slower wage inflation and overall price pressures in...
Fed Beige Book Reveals Softening Consumer Spending Amid Rising Price Sensitivity, Lower Demand For Leisure
Fed Beige Book Reveals Softening Consumer Spending Amid Rising Price Sensitivity, Lower Demand For Leisure
Mar 6, 2024
The latest findings from the March Federal Reserve Beige Book reveal Wednesday that while the economy has seen a slight overall increase in activity since the beginning of the year, consumer spending has experienced a downturn, particularly in the retail sector. This decline is attributed to increased price sensitivity among consumers, who are now more inclined to “trade down or...
Economic Activity Grew 'Slightly' Since Early January, Fed's Beige Book Shows
Economic Activity Grew 'Slightly' Since Early January, Fed's Beige Book Shows
Mar 6, 2024
03:13 PM EST, 03/06/2024 (MT Newswires) -- Economic activity in the US rose slightly since early January, while the growth outlook was generally positive, the Federal Reserve said in its latest Beige Book released Wednesday. Eight of the 12 Fed districts reported slight to modest growth in activity during the period, while three reported no change. One district reported a...
Federal Reserve Watch for March 6: Powell Says Rate Cuts Likely This Year, Will Proceed 'Carefully'
Federal Reserve Watch for March 6: Powell Says Rate Cuts Likely This Year, Will Proceed 'Carefully'
Mar 6, 2024
02:31 PM EST, 03/06/2024 (MT Newswires) -- Fed Chair Jerome Powell (voter) said in prepared testimony that it would likely be appropriate to cut interest rates this year if the economy evolves as expected but cautioned that risks remain and that the Federal Open Market Committee does not expect it would be time to lower rates until there is greater...
Copyright 2023-2026 - www.financetom.com All Rights Reserved