Federal Reserve's Balance Sheet Reaches $6.7 Trillion

Interest rates in the U.S. and other advanced economies, after decades of decline, have risen since the pandemic, reflecting central banks' efforts to control post-pandemic inflation. Whether these rates will return to pre-pandemic lows is uncertain and depends on factors such as changing demographics, global investment flows, productivity growth, and fiscal conditions. Demographic trends, including population aging, which previously contributed to low rates, have shifted, and fiscal pressures are now contributing to higher real rates. The Federal Reserve continues to play a central role in economic stabilization, not only through adjusting short-term interest rates but also by engaging in quantitative easing, which involves large-scale asset purchases to inject liquidity into the financial system. As of April 16, the Fed's total assets stand at $6.7 trillion, underscoring the scale of its interventions. These developments highlight the evolving landscape of U.S. monetary policy and the complex determinants shaping interest rate trends.