dharmatech

Correlation between Fed balance sheet changes and SPX

SP:SPX   S&P 500 Index
The United States Federal reserve publishes their balance sheet weekly, every Thursday at 4:30 ET.

Basically, when they add to their balance sheet, this is injecting money into the economy.

When they remove from their balance sheet, they are removing money from the economy.

This chart shows the recent adds and removes on the SPX chart.

There appears to be a rough correlation.

Also shown are the FOMC meetings. Often, there has been upward pressure following a meeting and downward pressure following the minutes.

Here's a link to the Federal Reserve site where the changes are shown in a graph:

https://fred.stlouisfed.org/graph/?g=NXbd

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