To alleviate dollar funding pressures, major central banks have also activated temporary swap lines with the US Federal Reserve to provide dollars to financial institutions in their national markets. Second, when credit markets are under severe stress, a central bank is sometimes expected to step in to support market functioning. The modality for central bank intervention differs across individual circumstances.
For instance, the Federal Reserve has pursued credit easing policy to unfreeze the US financial market by purchasing plain as well as assetbacked commercial paper, agency-related securities and so forth. In spite of its bankcentered system, Japan has also been affected by the turmoil in global capital markets.