Recent experience indicates that even in a situation of abundant global liquidity, local markets in foreign currencies can seize up and currency shortages swiftly propagate across currencies, international markets and time zones. This highlights the importance of the global liquidity provisioning concepts to counter illiquidity of particular markets.
BIS Review 15/2010  1  In a liquidity crisis, monetary authorities can engage in foreign currency liquidity-providing operations which can be classified into the following four major concepts: national foreign exchange reserves, pooling of reserves, inter-central bank swap lines or repos and monetary units or loan facilities by supra-national monetary authorities.