The Federal Reserve stated that it will begin selling corporate bonds and fixed income funds it bought last year to stabilize the financial system, lifting unprecedented emergency measures that will revitalize the market and reduce the borrowing costs of companies in trouble due to the financial crisis. Pandemic.

The U.S. central bank said on Wednesday that it will gradually sell assets acquired through its so-called secondary market corporate credit facility (SMCCF).

This tool combines the funds of the U.S. Treasury Department with the central bank’s own resources to acquire corporate bonds and exchange-traded funds in the secondary market.it is roll out In April last year, there were 12 other loans aimed at supporting debt markets that were under severe pressure due to the US economic shutdown.

According to data from the Federal Reserve, the total use of SMCCF and another tool designed to support major corporate debt markets is less than US$14 billion, which is less than 2% of the US$750 billion available.

The Fed’s touted limited use is a testament to its success in quickly restoring market operations, as long as it promises support. The price of corporate bonds has risen, and companies affected by the epidemic can still enter the capital market.

The central bank has also lowered interest rates to zero and promised to buy unlimited amounts of US government bonds.

The Federal Reserve said in a statement on Wednesday: “It has been proven that SMCCF played a vital role in resuming market operations last year, supporting large employers in obtaining credit, and promoting employment through the Covid-19 pandemic.”

“The sales of the SMCCF investment portfolio will be gradual and orderly, and will minimize the possibility of any adverse effects on the operation of the market by considering the daily liquidity and trading conditions of exchange-traded funds and corporate bonds.”

Investors basically ignored the announcement, partly because the Fed’s actual presence in the market is quite limitedAccording to the decision of the US Treasury Department, since the end of December, the facility has banned new purchases.

Patrick Leary, a senior trader at Incapital, said: “It’s hard to think of a more effective tool to support the flow of credit to companies during a pandemic.”

Fed officials also started debate When they may consider scaling back other emergency measures taken during the crisis, including the monthly purchase of $120 billion in government and mortgage debt.

Leary stated that the SMCCF’s statement paved the way for the discussion and the final cancellation of the policy.

“This is a small step and a good way to test the market’s response,” Leary said.