OTTAWA - The U.S. Federal Reserve, the Bank of Canada and other central banks have taken further actions to battle a deepening credit crisis that threatens to unhinge the international economy.
The Bank of Canada says it and the Federal Reserve have agreed to expand their reciprocal currency arrangement to 30 billion dollars US, up from the 10 billion dollars US announced September 18th.
The Bank of Canada says this swap line would be accessed, should the need arise, to provide U.S.-dollar liquidity in Canada.
It says if drawn on by the Bank of Canada, the swap would provide liquidity facilities for use by financial institutions in Canada.
The central banks say the co-ordinated action will expand the availability of cash to squeezed banks and other financial institutions, in an effort to relieve the most intense credit crisis since the Great Depression.
