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. (Read more Federal Reserve stories.)