The Fed is looking for the exit
The minutes of the March FOMC meeting show that the Fed is drawing up plans to reduce the size of its balance sheet. That can be done in various ways, of course. Until now, the Fed has reinvested maturing securities it had bought during its QE programmes, keeping its holdings of Treasury securities and Mortgage Backed Securities (MBS) constant at USD 2.5 trn and USD 1.8 trn, respectively. The Fed must now decide if it wants actively to sell securities, simply stop reinvesting monies received from all maturing securities or stop reinvesting, but put a ceiling at how much it wishes to reduce its balance sheet by per month. It must also decide which securities it wants to reduce its holdings of.