AlexiaX
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Tonight, all eyes are on the Federal Reserve, but the focus isn’t just the 25 bps rate cut. The real story may be a shift in the balance sheet strategy.
Since ending balance sheet reduction on Dec 1, banking reserves have tightened, pushing SOFR to the top of its range liquidity is under pressure.
The Fed may signal the Reserve Management Purchase Program (RMP), moving from contraction to moderate growth, possibly starting Jan 2026. Analysts expect purchases of $35–45B/month, injecting liquidity, stabilizing short term rates, boosting risk assets like $ETH, $LUNC, and marking a new policy era.
Powell’s words on the balance sheet could define market direction for 2026 any expansion hint may ignite a major market move.
#powell
Since ending balance sheet reduction on Dec 1, banking reserves have tightened, pushing SOFR to the top of its range liquidity is under pressure.
The Fed may signal the Reserve Management Purchase Program (RMP), moving from contraction to moderate growth, possibly starting Jan 2026. Analysts expect purchases of $35–45B/month, injecting liquidity, stabilizing short term rates, boosting risk assets like $ETH, $LUNC, and marking a new policy era.
Powell’s words on the balance sheet could define market direction for 2026 any expansion hint may ignite a major market move.
#powell
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