The repo mechanism for foreign central banks will be launched on April 6, and its duration will be at least 6 months. The Fed has already launched a number of programs to provide dollar loans at close to zero interest rates to other central banks for up to 84 days to ensure sufficient dollar liquidity outside the United States.
Earlier this month, the Fed reopened swap lines with five central banks in Canada, Japan and Europe, and began to provide loans of up to $60 billion to regulators in Australia, Brazil, Mexico and six other countries.
Many business transactions in the world are carried out in dollars, while international organizations issue dollar loans. The swap lines were actively used by the Fed in 2008 and 2009.
The Fed’s scale of action surpasses all that the regulator did during the 2008 global financial crisis and the debt crisis in the eurozone 2011-2012, since now dollar financing is available to a much larger number of central banks in developing economies.