Thanks for Rob Kirby of Kirby Analytics for bringing this to my attention. The latest report shows a BUILD in outstanding derivatives held by American bank holding cos. in the amount of 30+ Trillion in notional value. The increases are virtually ALL confined to two categories, Over the Counter Swaps [off balance sheet interest rate products] and Over the Counter Forwards [off balance sheet foreign exchange products]. Kirby thinks that Q1/21 the US Treasury in conjunction with the NY Fed trading desk are engaged in aggressive YIELD CURVE MANAGEMENT [via interest rate swaps] and aggressive foreign exchange [read: US dollar] “management” via Over the Counter Forwards. This is something to be aware of.
The Office of the Comptroller recently released their Q1/21 Quarterly Derivatives Report – take note of the data in Appendix Table 2 – [Derivatives held by American Bank Holding Companies.]:
You can compare Q1/21 to Q4/20 by viewing Q4 numbers here: