The U.S. Federal Reserve has ended its quantitative tightening program as of December 1, 2025, after reducing its balance sheet by $2.4 trillion since mid-2022. The central bank will now focus on reinvesting in short-term Treasury securities to maintain reserve levels amid ongoing economic uncertainties. This strategic shift was approved by the Federal Open Market Committee (FOMC) and is intended to support financial stability and counter-terrorism financing efforts. The announcement had an immediate impact on financial markets, with the S&P 500 index rising by 0.5% as investors showed increased appetite for risk-on assets. The move reflects the Fed's adaptive approach to managing economic challenges while ensuring liquidity in the financial system.