The Federal Reserve strong return to the short-term bond market, Wall Street urgently raises expectations for bond purchases.

The Federal Reserve announced that starting this Friday, they will purchase $400 billion worth of US Treasury securities every month, a scale higher than market expectations. This move is aimed at easing short-term interest rate pressures by supplementing bank reserves. This measure immediately prompted major Wall Street banks to revise their forecasts for the supply of US Treasury bonds in 2026, and led to a widespread decline in short-term borrowing costs. In addition to the new Reserve Management Purchase (RMP), the Federal Reserve will also reinvest approximately $144 billion worth of Treasury securities from maturing institutional bonds in December to further support the funding market.