NEW YORK, July 8 (Reuters) - The New York Federal Reserve said on Thursday that it conducted a swap of $6.0 billion of mortgage-backed securities in the latest week, the second operation in its plan to shift into more liquid MBS.
The New York Fed said it sold $6.0 billion of 30-year, 5.5 percent Fannie Mae FNMA.OB MBS and bought $4.0 billion of Fannie Mae 30-year, 4.5 percent MBS as well as $2.0 billion of Freddie Mac FMCC.OB 30-year, 4.5 percent MBS for July settlement. The transactions were conducted between July 1-7.
The operations are being used by the Fed to facilitate the timely settlement of the its agency MBS purchases. The operations are not expected to exceed the unsettled amount of $9.2 billion in 30-year, 5.50 percent coupons.
In the first operation, the Fed sold $2.5 billion of 30-year, 5.5 percent Fannie Mae MBS and bought $1.75 billion of Fannie Mae 30-year, 4.5 percent MBS as well as $750 million of Freddie Mac 30-year, 4.5 percent MBS for July settlement.