US Treasury Secretary explains MBS purchase program: The Trump administration will buy as much as the Federal Reserve shrinks its balance sheet.

 U.S. Treasury Secretary Scott Bessent said last Friday that the goal of the Trump administration's mortgage-backed securities (MBS) purchase program is to roughly match the pace at which these bonds are "rolling off" the Federal Reserve's balance sheet.

"The reality is that the Federal Reserve has about $15 billion of bonds rolling off each month," Bessent said in an interview with Reuters, referring to the Fed reducing its holdings of MBS from its total $6.3 trillion bond portfolio. "So I think the idea is to roughly match the Fed's moves, which have been pushing in the opposite direction."

U.S. President Trump took the latest step to address housing affordability by ordering the Federal Housing Finance Agency — the agency that regulates mortgage finance giants Fannie Mae and Freddie Mac — to purchase $200 billion of bonds issued by these two companies last Thursday. FHFA Director William Pulte said last Friday that they have already begun the first round of $3 billion in purchases.