Reserve balances were up by $81 bln (average of daily figures)...

Reserve balances were up by $81 bln (average of daily figures) in the week ending March 6. That was the biggest one-week jump in over a year.

Watch what happens now to bank credit growth, particularly loans and leases in bank credit. The growth rate will slow down. (Too bad, 'cause we've been on such a good run.)

It's not that banks don't want to lend; they do. It's just that this hinders them.

And the Fed is only doing $50 bln/mo balance sheet reduction, but reserves are growing faster so there will be net addition.