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Handout for Simon Potter’s Concluding Remarks at the Conference "Monetary Policy Implementation in the Long Run" Figure 2: SOMA Agency MBS Purchases and Primary Mortgage Rate Figure 1: Composition of SOMA Domestic Securities Holdings Billions of U.S. Dollars $4,500 Percent Billions of U.S. Dollars 6.0 $140 Agency debt $4,000 LSAP 1 Reinvestments LSAP 3 Freddie Mac 30-year Primary Mortgage Rate (Right) Agency MBS $120 5.5 $100 5.0 $80 4.5 $60 4.0 $40 3.5 $20 3.0 Treasury securities $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 $0 Jan-07 Aug-07 Mar-08 Oct-08 May-09 Dec-09 Jul-10 Feb-11 Sep-11 Apr-12 Nov-12 Jun-13 Jan-14 Aug-14 Mar-15 Oct-15 May-16 2.5 2009 Source: Board of Governors of the Federal Reserve System. Figures are weekly averages of daily figures and include unsettled holdings. 2010 2011 2012 2013 2014 2015 2016 Sources: Board of Governors of the Federal Reserve System; Federal Reserve Bank of New York; Federal Home Loan Mortgage Corporation. Figure 4: SOMA Purchases of Agency MBS by Coupon Figure 3: Projected versus Actual Receipts of Principal on SOMA Securities for 2016 3.0 Billions of U.S. dollars 3.5 4.0 4.5 100% $50 Projected agency MBS paydowns Actual MBS Paydowns 90% $45 80% $40 70% $35 $30 60% $25 50% $20 40% $15 30% $10 20% $5 10% $0 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 0% Dec-16 Sep-13 Source: Federal Reserve Bank of New York. Notes: Principal receipts for January 2016 through October 2016. Projections are as of December 31, 2015. Figures are monthly and are rounded. Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Source: Federal Reserve Bank of New York Notes: 30-year securities, across agencies. September 2013-September 2016. This does not include purchasses of 15-year MBS, which have ranged from 2.0 to 3.5 percent. Page 1/1