---
title: "🔥 Big Shift Today: The Fed Just Ended QT - What This Means For Overall Liquidity according to Goldman 🔥"
description: "After months of draining liquidity and a one-month delay that tightened markets, the Fed’s quantitative tightening officially ends today.\n\nHere’s what Wall Street is watching:\n\n💧 Reserves Are Scraping Bottom\nFed reserves hit a low in October, but should end 2025 around $2.9T - still uncomfortably close to “not enough.” Repo markets have already shown stress, with Standing Repo Facility usage hitting its 2nd-highest level since COVID.\n\n🏦 Goldman’s Call: QT Ends, Balance Sheet Growth Returns Fast\nGoldman expects the Fed to start buying ~$20B/month in T-bills starting Jan 2026, plus reinvesting MBS runoff - together adding ~$40B/month back into the system.\nReserves could climb back above $3T by late 2026.\n\n💣 Why the Pivot? Liquidity Is Too Tight\nRepo rates (TGCR, SOFR) are trading well above where they “should” be. Funding markets keep flashing red. The Fed is quietly preparing to reflood the pipes.\n\n📈 Treasury Supply Stays Heavy - But the Fed Becomes a Buyer Again\nWith massive deficits ahead, Treasury issuance remains huge. But thanks to the shift in policy:\n\nFed is expected to absorb ~$480B of next year’s T-bill issuance\n\nNon-Fed buyers only take ~$390B — the lowest since 2023\n\n🍃 But There’s a Catch…\nThe Fed will let $2T of MBS roll off, pushing a wave of mortgage-backed supply into markets. That means:\n➡️ More pressure on housing and mortgage rates\n➡️ A slow-motion shift from MBS → Treasuries in the system\n\n⚠️ Bottom Line:\nQT ends today, but the liquidity story is far from over.\nFunding markets are strained, repo is volatile, MBS supply is surging - and the Fed may be forced to restart balance sheet expansion faster than anyone expected.\n\nThe next big test? April tax season.\nIf liquidity cracks again, the Fed’s “reserve management purchases” may turn into something much bigger.\n\n\nSource: Goldman Sachs, zerohedge"
---

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# [🔥 Big Shift Today: The Fed Just Ended QT - What This Means For Overall Liquidity according to Goldman 🔥](https://blog.syzgroup.com/syz-the-moment/big-shift-today-the-fed-just-ended-qt-what-this-means-for-overall-liquidity-according-to-goldman)

 Written by [Charles-Henry Monchau, CFA, CMT, CAIA](https://blog.syzgroup.com/syz-the-moment/author/charles-henry-monchau) | Dec 2, 2025, 11:22:36 AM

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