System Open Market Account - SOMA


DEFINITION of 'System Open Market Account - SOMA'

An account that is managed by the Federal Reserve Bank, containing assets acquired through operations in the open market. The assets in the System Open Market Account (SOMA) serve as a management tool for the Federal Reserve's assets, a store of liquidity to be used in an emergency event where the need for liquidity arises, and as collateral for the liabilities on the Federal Reserve's balance sheet such as U.S. dollars in circulation.

BREAKING DOWN 'System Open Market Account - SOMA'

The SOMA consists of the domestic securities and foreign currency portfolios of the Federal Reserve. The domestic portion consists of U.S. dollar-denominated treasuries, while the foreign currency portion consists of different investments all denominated in Euro and Yen currencies.

  1. Liquidity

    The degree to which an asset or security can be quickly bought ...
  2. Monetary Policy

    Monetary policy is the actions of a central bank, currency board ...
  3. Federal Reserve Bank

    The central bank of the United States and the most powerful financial ...
  4. Foreign

    1. A non-U.S. company with securities trading on the North American ...
  5. Federal Open Market Committee - ...

    The branch of the Federal Reserve Board that determines the direction ...
  6. U.S. Treasury

    Created in 1798, the United States Department of the Treasury ...
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