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Fed pumps up more liquidity with other central banks PDF Print E-mail
Thursday, 13 March 2008

Agence France-Presse . Washington

The US Federal Reserve announced moves Tuesday to pump more liquidity into the global financial system, easing terms for direct loans to banks and increasing swap arrangements with other central banks.

The Fed said it was pumping 200 billion dollars into a new Term Securities Lending Facility, with term of 28 days instead of overnight under an existing program.

This allows banks to obtain Treasury securities by pledging collateral such as mortgage-backed securities and other debt. Auctions will be held on a weekly basis, beginning on March 27.

The Fed also said it has authorized increases in its existing temporary reciprocal currency arrangements or swap lines with the European Central Bank and the Swiss National Bank.

The Fed will provide up to 30 billion dollars to the ECN and six billion to the SNB. It was the latest in a series of steps to help get credit flowing in the global financial system, which has been gridlocked by concerns about market turmoil.

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