While national foreign exchange reserves might alleviate temporary shortages in an individual institution or economy, their limited quantity might reduce their effectiveness during large systemic events. This suggests a need for additional sources involving cross-border cooperation. However, measures that are provided at the discretion of monetary authorities are based on a case-by-case assessment and a decision by the respective lender.
We have initiated a series of twenty-eight-day single-tranche term repurchase transactions with primary dealers, expected to cumulate to $ billion outstanding, in which dealers may offer any of the types of collateral that are eligible for conventional open market operations. We have also expanded and extended reciprocal currency arrangements (“swap lines”) with the European Central Bank and the Swiss National Bank.