Fed Survey Sees About $220 Billion in Bill Buying Over 12 Months

Respondents to a Federal Reserve survey anticipated that the central bank’s reserve management purchases will total more than $200 billion over 12 months as part of efforts to quell pressures in money markets.

Fed policymakers decided at the Dec. 9-10 meeting to begin Treasury bill purchases after deeming that reserves in the financial system had dropped to levels considered as ample as indicated by rising short-term funding costs. While bank reserve levels vary over time, cash needs tend to increase during month-end and quarter-end periods when tax and other settlement payments are due.

“While the estimated size of expected ...