March 19, 2020 / 1:13 PM / 13 days ago

Fed opens new dollar swap lines with 9 new foreign central banks

WASHINGTON, March 19 (Reuters) - The U.S. Federal Reserve opened the taps for central banks in 9 new countries to access dollars in hopes of preventing the coronavirus epidemic from causing a global economic rout.

The Fed said the swaps, in which the Fed accepts other currencies as collateral in exchange for dollars, will for at least the next six months allow the central banks of Australia, Brazil, South Korea, Mexico, Singapore, Sweden, Denmark, Norway and New Zealand to tap up to a combined total of $450 billion, money to ensure the world’s dollar-dependent financial system continues to function.

Reporting by Howard Schneider Editing by Chizu Nomiyama

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