TITLE

Stress Testing the Fed

AUTHOR(S)
CHRISTENSEN, JENS H. E.; LOPEZ, JOSE A.; RUDEBUSCH, GLENN D.
PUB. DATE
March 2014
SOURCE
FRBSF Economic Letter;3/24/2014, Vol. 2014 Issue 8, p1
SOURCE TYPE
Trade Publication
DOC. TYPE
Article
ABSTRACT
The Federal Reserve has purchased a large amount of longer-term bonds since December 2008. While these purchases have helped support a strengthening economy, the Fed's resulting financial position may incur significant declines in bond values and net income when interest rates rise. However, analyzing a range of possible future interest rate scenarios--and their associated probabilities--shows that potential losses associated with these declines are very likely to be manageable.
ACCESSION #
95262956

 

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