The Federal Reserve Bank of New York announced that it will begin buying about $40 billion of short term US Treasury bills each month beginning on December 12 2025. This step is called the Reserve Management Purchases program and it is meant to help ensure that banks have enough cash in the system and that interest rates stay under control. #BTC 
UpThe central bank made this decision after months of reducing its balance sheet in a process known as quantitative tightening which cut the Fed holdings from about nine trillion dollars to around six point six trillion dollars. This reduction left less cash or reserves in the banking system and put pressure on short term markets.
Fed officials say that buying Treasury bills is not a big new stimulus program or a return to full scale QE. Instead it is a technical step meant to make sure that money markets work properly and that banks can meet their reserve needs. The purchases are designed to balance expected seasonal swings such as tax payments and other large outflows that can drain cash from banks.
The Fed will buy Treasury bills that mature within a year and will set monthly purchase schedules based on how much cash banks need and how markets are functioning. Officials expect that the pace of purchases may vary with market conditions and seasonal needs.
Investors welcomed the move because it helps reduce strain in very short term funding markets like the repo market where banks borrow and lend cash overnight. After the announcement markets saw short term borrowing costs fall and treasury yields move lower.#BinanceSquareTalks
Fed Chair Jerome Powell emphasized that this action is not meant to signal a change in interest rate policy but rather to keep financial markets stable during what can be a volatile time at the end of the year.
Overall the plan to buy $40 billion in Treasury bills each month is meant to keep the banking system healthy and money markets calm while maintaining the central bank’s ability to guide short term interest rates e
ffectively.
