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Powell: Fed's Pandemic Purchases Fueled Housing Affordability Crisis

10/15/2025

Summary

Story summary

Federal Reserve Chair Jerome Powell said the Fed's pandemic asset purchases may have been excessive and should have stopped sooner.
Powell noted that purchases of mortgage-backed securities contributed to housing price gains and reduced affordability.
Powell said balance sheet normalization does not return to pre-pandemic conditions, as demand for reserves has risen.
Powell stated that reserve interest payments do not burden taxpayers, since profits go to the Treasury.

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Story summary

Federal Reserve Chair Jerome Powell said the Fed's pandemic asset purchases may have been excessive and should have stopped sooner.
Powell noted that purchases of mortgage-backed securities contributed to housing price gains and reduced affordability.
Powell said balance sheet normalization does not return to pre-pandemic conditions, as demand for reserves has risen.
Powell stated that reserve interest payments do not burden taxpayers, since profits go to the Treasury.