🚨 The Federal Reserve suddenly increases bond purchases: Wall Street forced to collectively revise 2026 forecasts

The Federal Reserve announced:

Monthly purchase of $40 billion in short-term U.S. Treasury bonds — significantly exceeding market expectations.

The result directly shook Wall Street, prompting major banks to urgently revise their debt issuance and interest rate assumptions for 2026:

Barclays: Estimates that the Federal Reserve's purchasing scale in 2026 will rise from $345 billion to $525 billion

J.P. Morgan, TD Securities: Expect the Federal Reserve to absorb a larger scale of government bonds

**Bank of America:** Believes that the Federal Reserve may have to maintain this "accelerated bond purchasing pace" for a longer time to replenish reserves and stabilize money market interest rates.

Strategists' views are quite consistent:

This action by the Federal Reserve is extremely unusual, sending a strong signal — it has a very low tolerance for financing pressures.

The short-end market reacted immediately:

The two-year swap spread widened to the highest level since April.

SOFR-FF basis strengthened.

Short-end interest rate futures trading volume surged.

In simple terms:

This is a "mini QE," and short-term liquidity pressures have been noticeably alleviated.