Central banks to coordinate to back US dollar liquidity

ANKARA

Six major central banks on Friday announced coordinated action to further enhance the provision of U.S. dollar liquidity via swap line arrangements.

The Bank of Canada, Bank of England (BoE), Bank of Japan (BoJ), European Central Bank (ECB), Federal Reserve (Fed) and Swiss National Bank (SNB) announced they would offer seven-day maturity for U.S. dollar operations on a daily basis instead of weekly in order to improve the swap lines' effectiveness in providing greenback funding.

Daily operations, commencing on Monday, will continue at least through the end of April, the ECB said in a statement.

The central banks will also continue to hold weekly 84-day maturity operations, they added in a statement.

"The swap lines among these central banks are available standing facilities and serve as an important liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the effects of such strains on the supply of credit to households and businesses, both domestically and abroad," it read.