When the Fed buys U.S. Treasury bonds from a bank, it increases the supply of reserves by crediting the seller's account at the Fed.

Name: When the Fed buys U.S. Treasury bonds from a bank, it increases the supply of reserves by crediting the seller's account at the Fed.
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When the Fed buys U.S. Treasury bonds from a bank, it creates new reserves by crediting the amount of the purchase to the seller's account at the Fed. This increases the overall supply of reserves in the banking system.

When the Fed Buys U