Central Banks announced to provide unlimited dollar funding to improve liquidity in short-term US dollar funding markets. These measures will be in place as long as needed, and at least until January 2009, ECB states.
In a joint move world Central Banks announced to provide unlimited dollar funding to improve liquidity in short-term US dollar funding markets. These measures will be in place as long as needed, and at least until January 2009, ECB states.
The BoE, ECB and SNB will conduct tenders of U.S. dollar funding at 7-day, 28-day and 84-day maturities at fixed interest rates for full allotment. Funds will be provided at a fixed rate, set in advance of each operation. Counterparties in these operations will be able to borrow any amount they wish against the appropriate collateral in each jurisdiction. Accordingly, sizes of the reciprocal currency arrangements (swap lines) between the Federal Reserve and the BoE, the ECB, and the SNB will be increased to accommodate whatever quantity of US dollar funding is demanded.
The Bank of Japan will be considering the introduction of similar measures.
ECB press release
© ECB - European Central Bank
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