Fed adds another $5.2 billion in MBS from Operation Twist

The Federal Reserve Bank of New York purchased another $5.2 billion in mortgage-backed securities guaranteed by the government as part of its latest effort to keep borrowing costs low. In October, the Fed began buying up $400 billion in long-term Treasury bonds and reinvesting principal payments on agency MBS to purchase more. In the first week of the so-called “Operation Twist,” the Fed bought $3.95 billion in securities. From Oct. 6 through Wednesday, the New York Fed bought $1.85 billion in MBS guaranteed by Freddie Mac, $2.65 billion in Fannie Mae securities and $700 million in Ginnie Mae bonds. The Fed said it would publish and an estimate around the eighth business day of each month for future purchases. Mortgage rates continue to hover near record lows, but last week the 30-year FRM bounced back up above 4%. Write to Jon Prior. Follow him on Twitter @JonAPrior.

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