The U.S. Federal Reserve’s borrowings balance has decreased as banks borrow less from the central bank, signs suggesting the economy is easing.

Banks cut borrowing from the Federal Reserve's emergency lending program, while investment firms took a pass for the fourth straight week according to Fed data released.

The Fed's balance sheet -- a broad gauge of its lending to the financial system -- shrank to $2.036 trillion on Wednesday from $2.062 trillion on June 3. It peaked at $2.179 trillion on April 22.

The Fed on Thursday said commercial banks averaged $36.9 billion in daily borrowing over the week that ended Wednesday. That was down from $41.9 billion in the week ending June 3.

In another encouraging sign, the report showed the Fed's net holdings of commercial paper averaged $140.8 billion over the week that ended Wednesday, a decrease of $4.3 billion from the previous week.