Central Banks Move to Ease Market Strains
Stock futures surge on the news
By Kate Seamons, Newser Staff
Posted Nov 30, 2011 7:41 AM CST
Updated Nov 30, 2011 7:59 AM CST
Central banks around the world said Wednesday, Nov. 30, 2011, they are taking coordinated action to ease strains on the financial system.   (AP Photo/Richard Drew, File)

(Newser) – Central banks around the world plan to ease the strain on the global financial system by taking coordinated action to prevent a lack of liquidity, they announced in a statement this morning—news that sent stock futures soaring more than 250 points. The Bank of Canada, Bank of England, Bank of Japan, European Central Bank, and the Swiss National Bank join the Fed in the moves, which the AP reports will, as of next Monday, "reduce the cost of temporary dollar loans to banks—called liquidity swaps—by a half percentage point." NPR explains that'll make it easier for financial institutions to get cash, which they'll hopefully then lend at reduced interest rates.

The AP reports that these central banks are also working to shore up banks' ability to ready money in any currency if market conditions warrant, though "at present, there is no need to offer liquidity in non-domestic currencies," the Fed's statement noted. "The purpose of these actions is to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity," explained the Fed.

View 1 more image
More From Newser
My Take on This Story
To report an error on this story,
notify our editors.
Central Banks Move to Ease Market Strains is...
20%
5%
13%
18%
25%
20%
Show results without voting
You Might Like
Comments
Showing 3 of 4 comments
Non-deep-thinker
Nov 30, 2011 12:28 PM CST
Move to "ease" market strains. lol I wonder what that means...
Buckshot
Nov 30, 2011 10:18 AM CST
I get a kick every time a Conservative politician try to use the sitting US president as a economic punching bag for political gains. Everyone world wide knows how this whole mess got started and who was not in control of the ship as it sank. No life boat ride out of office can save the Bush administration from getting 100% of the blame for the pain and suffering they caused the whole world, Henry Paulsen should be serving time, not playing golf and boating you can also throw the old wrinkled ass of Allen Greenspan in the same cell while your at it. Conservative principles my ass. These kind of efforts prove just how close the world came to total financial melt down under GOP government leadership.
Cat-Lover
Nov 30, 2011 8:07 AM CST
The key-word in this report is "hopefully" if for no other reason than it's not a word. When used as in this report it means no strings are being attached to this cash assurance making the banks lend this extra money which is what's holding back any recovery. If we don't make the banks lend, global economies will not improve. We must state that all monies assured to banks will be lent at reasonable interest rates. If not, the 1% win again.