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Fed reports narrowing $19.6 billion loss for operations in 2025?

BY Reuters | ECONOMIC | 12:00 PM EDT

By Michael S. Derby

NEW YORK, March 25 (Reuters) - The Federal Reserve reported a narrower loss last year in an audited financial statement released on Wednesday. The Fed said that its total comprehensive loss for the full year of 2025 stood at $19.6 billion, versus $77.5 billion in red ink for 2024 and a $114.6 billion loss in 2023. The Fed last turned a profit in 2022 and returned $76 billion to the government that year, down from $109 billion in 2021.

The Fed's losses are tied to the size of its balance sheet, which swelled massively during the COVID-19 pandemic as the Fed bought Treasury and mortgage bonds aggressively to both stabilize troubled financial markets and to provide economic stimulus when its interest rate target was at near zero levels and could be trimmed no further. (Reporting by Michael S. Derby; Editing by Chizu Nomiyama)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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