Fed Reveals Which Bonds It Purchased

In a separate disclosure, the New York Fed released the composition of the broad index the central bank is using to conduct the purchases. Fed officials have said the goal of the buying is to maintain liquidity in the market for corporate debt, so that issuers are able to access capital despite the deep economic downturn created by the pandemic. The index consists of almost 800 issuers.

In mid-May, the Fed began buying exchange-traded funds invested in corporate debt as it readied for outright purchases. As of Tuesday, the Fed had amassed $8.71 billion of assets including ETFs and individual securities through the program, known as the Secondary Market Corporate Credit Facility.

On June 17, Fed Chairman Jerome Powell told the House Financial Services Committee that the central bank would reallocate purchases of ETFs toward individual debt securities through the index it created.

"Buying cash bonds is going to form the primary mode of support over time by which we support market function," Powell said during the hearing. "Over time, we will gradually move away from ETFs."

The program is set to expire on Sept. 30.

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