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Thursday Fed Reports on SOMA, the Balance Sheet, and Money Supply
On Thursdays at 16:30 ET, the Federal Reserve releases a variety of data on the System Open Market Account (SOMA) holdings, reserve balances at the Fed, and the money supply. Our calculation for the average maturity in months for the SOMA holdings in the week ended May 16 was up to 102.8 from 101.6 in the prior week. Federal Reserve holdings in the SOMA fell $4.8 billion in the week. The decrease was mainly due to declines in Treasurys (-$4.3 billion) and Maiden Lane LLCs (-$5.2 billion) that was offset by a rise in Agency MBS (+$5.2 billion). In the money supply data for the week ended May 7, M1 decreased $34.0 billion from the prior week, and M2 was down $1.7 billion. Non-M1 M2 was up $32.3 billion billion. The increase was in savings deposits (+$31.0 billion). For details, see our updates on May 17.
May 17 Economic Research

A Full House at the Board of Governors, But Likely Not for Long
The Senate has confirmed the two nominees to the Board of Governors. Jerome Powell will fill the term ending on January 31, 2014, and Jeremy Stein's term will end January 31, 2018. However, current Governor Elizabeth Duke's term expired at the end of January 2012. Now that the Board will have more than the minimum five votes to act in "unusual and exigent" circumstances, she may elect not to linger.
May 17 Federal Reserve

Mortgage Focus: Delinquencies Decline; Inventories Don't
Key Takeaways
-- Mortgage delinquency rates declined in the first quarter. Delinquency rates declined for all stages of delinquency.
-- Declines in early stage delinquencies are contributing to declines in serious delinquencies.
-- The foreclosure start rate declined slightly. Foreclosure starts should pick up going forward.
-- The foreclosure inventory rate will remain elevated for some time, as foreclosure timelines have lengthened. That's not temporary.
-- Progress in reducing foreclosure inventory varies a lot by state; foreclosure inventories are still rising in states with judicial foreclosure processes.
May 16 Mortgages

April 24-25 FOMC Meeting Minutes - ''Several Members'' Could Support More Easing
Key Takeaways:
1. The Committee remains cautious about the economic outlook and the possibility of a negative impact from the situation in Europe and slower growth in the global economy. However, on the whole the tone was more upbeat.
2. A more rules-based approach to monetary policy was discussed.
3. While "several members" talked about more accommodation if needed, we think this point has been given too much emphasis. There is also plenty of opposition on the Committee to further easing.
4. The Committee expanded all one-day meetings to two-day sessions for the remainder of 2012 and all of 2013.
May 16 Federal Reserve

TIC Focus: Modest Bond Buying in March; Another Data Upgrade
Key Takeaways:
--Foreign investors were buyers of $20.5 billion in Treasuries in March; the purchases may have been depressed at the margin by a delayed settlement of late-month auctions.
--The latest holdings data indicate that China was a seller -- not a buyer -- of Treasuries in February.
--Foreign investors were sellers of $6.7 billion of agencies and buyers of $1.5 billion of corporates in March.
--Treasury introduced new data today that provide more timely information on foreign holdings of agencies and corporates.
May 15 Fixed Income