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Fed will pay smaller dividend to the US Treasury for 2017

The US Federal Reserve administration has announced it will pay a little smaller dividend to the Treasury in 2017 than in 2016, due to the rise in interest rates. According to a preliminary estimate for 2017, the Fed plans to contribute 80.2 billion USD to the federal budget, or 11.7 billion USD (12.3%) less than in 2016.

The US Federal Reserve payments are down for a second consecutive year, although they remain three times higher than before 2008, when the central bank began the large-scale bonds purchasing.

After covering its own expenses, the US Federal Reserve transfers each year to the Ministry of Finance its remaining funds, which are used to reduce the budget deficit.

The bank reported that the higher interest rates paid to banks for their reserves are the main reason for reducing payments to the government. The final estimate will be published in March, but it will probably differ slightly from the 80.2 billion USD now announced.

About James McGovern

James McGovern is from Arizona, USA. He is business analyst and writer at Finance Apprise Journal, responsible for finance and trading sections, as well as news from USA and Canada.

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