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Fed To Buy Fannie, Freddie, FHLB Debt Securities Friday
01/08 12:08 PM
NEW YORK (Dow Jones)--The Federal Reserve Bank of New York will hold its sixth auction Friday for the purchase of debt securities issued by Fannie Mae (FNM:$0.777000,$0.027000,3.60%) , Freddie Mac (FRE:$0.78,00$0.03,004.00%) , and the Federal Home Loan Banks system.
This will be the central bank's first purchases for the year. It bought securities of various maturities in December worth $15 billion. The bank announced plans to buy $100 billion of debt issued by these government-sponsored enterprises, and more, if necessary.
This time around, the Fed will buy debt securities that are due between Jan. 18, 2011, and Dec. 21, 2012.
The Fed purchase of debt notes has narrowed risk premiums on these securities that were historically wide last year. It also has boosted investor demand for new debt securities as both Fannie and Freddie sold new bond issues to strong buyer interest this week.
The Fed purchase of these bonds will be between 10:30 a.m. and 11 a.m. Friday.
-By Prabha Natarajan, Dow Jones Newswires; 201-938-5071; prabha.natarajan@ dowjones.com
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(END) Dow Jones Newswires
01-08-091208ET
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