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Bank of Canada stands aside from co-ordinated US$ auctions by other central banks |
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Written by THE CANADIAN PRESS
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Friday, 10 October 2008 |
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OTTAWA - The Bank of Canada said Tuesday it is not taking part in a co-ordinated action by other central banks to expand their provision of U.S.-dollar liquidity.
The bank said it "welcomes these initiatives," but "judges that it is not necessary for it to participate in these auctions at this time."
The U.S. Federal Reserve, the European Central Bank and the central banks of England, Japan and Switzerland announced schedules Tuesday for fourth-quarter auctions of U.S.-dollar liquidity to commercial banks.
The Bank of Canada said it "continues to closely monitor global market developments and remains committed to providing liquidity as required to support the stability of the Canadian financial system and the functioning of financial markets."
The Federal Reserve, in a statement parallel with the other participating central banks, presented dates for 28-day and 84-day term auctions and two preliminary dates for forward auctions of U.S. dollars until year-end.
It said scheduling of the forward auctions - designed to reassure market participants that term funding will be available through year-end - "is still tentative and may be adjusted in response to financial market conditions."
Tuesday's announcement follows co-ordinated central bank auctions previously scheduled for October and November, in an effort to ensure commercial banks have enough ready cash to continue lending.
The Federal Reserve's provision of short-term loans to banks through the scheduled auctions will provide as much as US$900 billion in cash.
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Last Updated ( Friday, 10 October 2008 )
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