The Fed will start winding down a program that saved the economy

In a statement, the central bank said the facility was vital for businesses during the depth of the recession. But with the economy recovering quickly, time has started to shut it down.

The program “had proven critical over the past year in restoring market functionality, supporting the availability of credit for large employers and boosting employment through the Covid-19 pandemic,” the Fed said.

The Fed currently holds $ 13.7 billion in corporate assets, including more than $ 5 billion in corporate bonds and an additional $ 8.5 billion in exchange-traded funds.

That’s a huge amount of money to handle, so the Fed said it would sell these assets over time to keep the markets working properly and reduce any resulting shock to the system.

“The portfolio sale will be gradual and orderly, aiming to minimize the potential for negative impact on the functioning of the market,” said the Fed.

The company’s assets come on top of an additional $ 7 trillion in national debt, which the Fed claims will continue to buy to keep the economic recovery going. At a press conference in April, Federal Reserve Chairman Jerome Powell said it was not time to think about curbing government bond purchases.

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