Dallas Fed President Lorie Logan discussed the balance sheet in a Bloomberg interview, emphasizing the ample liquidity due to significant RRP balances. Logan highlighted the uncertainty post RRP depletion and the 1-for-1 reduction in reserves during QT. She suggested slowing asset runoff as reverse repo dwindles, aiming for near-zero RRP levels.
Lorie Logan says she wants RRP to zero-ish, and then to slow QT: https://t.co/xp08izgZ8A Chris Waller says $500bn RRP means QT can continue, and SRF should help them gauge reserve scarcity: https://t.co/6aYeUMximf https://t.co/V4fDaQPzdl
🔴 FED'S LOGAN: AFTER ON RRP IS DRAINED, QT WILL REDUCE RESERVES ON 1-FOR-1 BASIS, ALL ELSE EQUAL.
🔴 FED'S LOGAN: SIGNIFICANT ON RRP BALANCES MEAN WE CAN BE CONFIDENT LIQUIDITY IS MORE THAN AMPLE.
🇺🇸 *DALLAS #FED PRESIDENT LORIE LOGAN REMARKS IN SPEECH TEXT - BBG *LOGAN: FED SHOULD SLOW ASSET RUNOFF AS REVERSE REPO DWINDLES
🔴 FED'S LOGAN: ONCE THE ON-RRP IS EMPTY, THERE WILL BE UNCERTAINTY OVER HOW MUCH EXCESS LIQUIDITY REMAINS.
Dallas Fed President Lorie Logan Talks Balance Sheet in Bloomberg Interview https://t.co/oDUActx9BT It will be interesting to see how she does. Nice to see someone who might actually understand the plumbing.