Fed's Balance Sheet and Interest Rate Expense

Higher Interest Rates Fuel Losses at the Federal Reserve
https://www.wsj.com/articles/higher-interest-rates-fuel-losses-at-the-federal-reserve-11667208602
The central bank is now paying out more in interest expenses than it earns in interest income

My take from April 19, 2022:

https://thehill.com/opinion/finance/3272668-is-4-percent-inflation-the-new-normal/

A second challenge facing the Fed involves its $9 trillion balance sheet. Unlike simplistic textbook narratives, the central bank no longer has the luxury of undertaking open market operations to shift its target for the federal funds rate (FFR). Instead, in the current ample reserves regime, the Fed utilizes two rate instruments – the interest on reserves (IOR) and the overnight reverse repurchase agreement rate (ONRRP) – to adjust its target policy rate. Essentially, raising the FFR target requires the Fed to also raise IOR and ONRRP.
If the yield curve were to invert, the Fed may encounter a balance sheet problem as it may be forced to pay out higher rates on bank reserves to large financial institutions even as it receives lower rates on its substantial holdings of long-dated U.S. Treasuries. This is certain to generate political backlash in Washington, D.C. 

Related:

Fed Is Losing Billions, Wiping Out Profits That Funded Spending

https://www.bloomberg.com/news/articles/2022-10-25/fed-is-losing-billions-wiping-out-profits-that-funded-spending 

"Profits and losses aren’t usually thought of as a consideration for central banks, but rapidly mounting red ink at the Federal Reserve and many peers risks becoming more than just an accounting oddity.
The bond market is enduring its worst selloff in a generation, triggered by high inflation and the aggressive interest-rate hikes that central banks are implementing. Falling bond prices, in turn, mean paper losses on the massive holdings that the Fed and others accumulated during their rescue efforts in recent years".