7주차 | 경제·금융·무역_이정석

[한영과21기 이정석]

Title	Understanding the Fed’s Balance Sheet
Speaker	Jerome H. Powell, Chair of Federal Reserve
Date	OCT 14, 2025
Event	67th Annual Meeting of the National Association for Business Economics
Words	439
Link	Speech by Chair Powell on the economic outlook and monetary policy - Federal Reserve Board

1	National Association for Business Economics	전미 기업경제학회
2	Adam Smith Award	아담 스미스 상, 유럽경제학회가 수여하는 상
3	balance sheet	재무상태표/대차대조표
4	ample reserves implementation framework	충분한 준비금 운영 프레임워크
5	central bank liabilities	중앙은행 부채
6	ledger	회계 장부/원장
7	depository institutions	예금취급기관
8	Treasury General Account/TGA	재무부 일반계정, 미 재무부의 연준 계정
9	mortgage-backed securities/MBS	주택저당증권

Thank you to the National Association for Business Economics for the Adam Smith Award. It is an honor just to be mentioned alongside past recipients, including my predecessors. Thank you for this recognition and for the opportunity to speak with you today.

Monetary policy is more effective when the public understands what the Federal Reserve does and why. With that in mind, I hope to enhance understanding of one of the more arcane and technical aspects of monetary policy: the Federal Reserve's balance sheet. A colleague recently compared this topic to a trip to the dentist, but that comparison may be unfair—to dentists.

Today, I will discuss the essential role our balance sheet played during the pandemic, along with some lessons learned. I will then review our ample reserves implementation framework and the progress we have made toward normalizing the size of our balance sheet. I will conclude with some brief remarks on the economic outlook.

One of the primary purposes of a central bank is to provide the monetary foundation for the financial system and the broader economy. This foundation is made of central bank liabilities. On the Fed's balance sheet, the liability side of the ledger totaled $6.5 trillion as of October 8, and three categories account for roughly 95 percent of that total First, Federal Reserve notes, that is, physical currency, totaled $2.4 trillion. Second, reserves—funds held by depository institutions at the Federal Reserve Banks—totaled $3.0 trillion. These deposits allow commercial banks to make and receive payments and meet regulatory requirements. Reserves are the safest and most liquid asset in the financial system, and only the Fed can create them. The adequate provision of reserves is essential to the safety and soundness of our banking system, the resilience and efficiency of our payments system, and ultimately the stability of our economy.

Third is the Treasury General Account/TGA, currently at about $800 billion, which essentially is the checking account for the federal government. When the Treasury makes or receives payments, those flows affect dollar-for-dollar the supply of reserves or other liabilities in the system.

The asset side of our ledger consists almost entirely of securities, including $4.2 trillion of U.S. Treasury securities and $2.1 trillion of government-guaranteed agency mortgage-backed securities/MBS When we add reserves to the system, we generally do so by purchasing Treasury securities in the open market and crediting the reserve accounts of the banks involved in the transaction with the seller. This process effectively transforms securities held by the public into reserves but does not change the total amount of government liabilities held by the public.