JPMorgan Chase has executed a major financial strategy by reallocating nearly $350 billion from its Federal Reserve account into US Treasuries. This move comes in the wake of the Federal Reserve's recent interest rate cuts, marking a pivotal shift in the bank's investment approach. The source reports that this strategy reflects the bank's confidence in the stability of US government bonds.
JPMorgan's Balance at the Federal Reserve
Recent SEC filings reveal that JPMorgan's balance at the Federal Reserve plummeted from $409 billion at the end of 2023 to just $63 billion by the third quarter of 2025. In contrast, the bank's Treasury holdings experienced a remarkable increase, soaring from $231 billion to $450 billion during the same timeframe.
Response to Federal Reserve's Interest Rate Changes
This strategic shift is a direct response to the Federal Reserve's decision to lower interest rates to their lowest levels in three years, following a period of aggressive rate hikes that saw rates rise from near zero to over 5 percent between 2022 and early 2023. JPMorgan's withdrawals have had a significant impact, effectively counterbalancing changes in Fed balances across more than 4,000 other US banks.
Impact on Total Bank Balances
As a result, total bank balances have seen a dramatic decline, dropping from $19 trillion to $16 trillion since the beginning of 2024. This trend underscores the broader implications of JPMorgan's financial maneuvers in the current economic landscape.
In a related development, former President Donald Trump is advocating for deeper interest rate cuts while considering candidates for the next Federal Reserve Chair. This push could significantly impact the economy and the cryptocurrency market, as detailed in the article read more.
