Fed Begins Buying MBS

The Federal Reserve Bank of New York has begun purchasing fixed-rate mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae. The New York Fed, which is overseeing the program for the Federal Reserve, has tapped investment managers BlackRock Inc., Goldman Sachs Asset Management, PIMCO and Wellington Management Co. to purchase the securities, according to an AP report.

The New York Fed says summary data detailing these operations will be available on its Web site beginning Jan. 8 and will be updated on a weekly basis each Thursday.

The program, first announced on Nov. 25, 2008, is intended to support the mortgage and housing markets and foster improved conditions in financial markets more generally. Up to $500 billion in securities will be purchased by the end of the second quarter, the AP report adds.

SOURCES: Federal Reserve Bank of New York, Associated Press

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