The Federal Reserve's unrealized losses on bond holdings narrowed to less than $850 billion last year.

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ME News Report, April 15 (UTC+8), New York Federal Reserve local time Monday stated that the unrealized losses on the Fed’s large bond holdings last year have decreased compared to 2024, with a book loss of $844.2 billion in 2025 versus $1.06 trillion in 2024.
This data was disclosed when the System Open Market Account (SOMA) annual report was released, which covers the Fed’s substantial holdings of cash, bonds, and other assets.
The unrealized losses on the Fed’s bond holdings are mainly accounting entries; in the view of the Fed and many observers, such paper losses do not impact the Fed’s operations because there are no plans to sell the held U.S. Treasuries and mortgage-backed securities.
As long as they are held to maturity, they will not incur actual losses relative to the purchase price.
However, some believe these paper losses reflect a negative record of the Fed’s use of its balance sheet as a tool for market stabilization and stimulus, and they argue that these losses could theoretically turn into actual problems in the future.
(Source: Jinshi)

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