The Federal Reserve and different world central banks have introduced recent measures to enhance US greenback liquidity as world monetary markets reel from the turmoil hitting the banking sector.
In a joint assertion launched on Sunday, the world’s main central banks stated that they’ll launch every day operations to make funding obtainable by way of standing swap traces. Beforehand, these operations have been carried out on a weekly foundation.
The Fed, European Central Financial institution, the Financial institution of England and the Swiss Nationwide Financial institution are amongst these concerned in what was described as a “co-ordinated motion”. They have been joined by the Financial institution of Canada and the Financial institution of Japan.
“The community of swap traces amongst these central banks is a set of accessible standing amenities and function an essential liquidity backstop to ease strains in world funding markets, thereby serving to to mitigate the consequences of such strains on the availability of credit score to households and companies,” the central banks stated in a press release.
The transfer got here hours after the SNB introduced that its two largest banks, UBS and Credit score Suisse, would merge after a frantic weekend of negotiations brokered by Swiss regulators to safeguard its banking system and try to stop a disaster spreading throughout world monetary markets.