All else being equal, if a central bank sells government securities to the market it would decrease the money supply.
Open market operations (OMO) are the Federal Reserve's (the Fed) practice of purchasing and disposing of U.S. Treasury securities as well as other securities on the open market in an effort to control the amount of money held in reserve by U.S. banks. To raise the amount of money in circulation and to lower long-term interest rates, the Fed buys Treasury securities and sells them.
OMOs aim to influence short-term interest rates and other interest rates by adjusting the level of reserve balances. By purchasing or offering to sell government bonds to or from commercial banks, the Federal Reserve conducts open market operations to reach the desired target federal funds rate.
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