RESCUING EUROPE

dollar, euro

ECB and other central banks announce liquidity effort. Click chart for more currency data.

NEW YORK (CNNMoney) — Five central banks announced a coordinated plan Thursday to pump dollars into Europe’s financial system in an effort to boost liquidity across the eurozone.

The European Central Bank, along with the Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank will hold three dollar auctions for U.S. dollars, with a three-month maturity, through the end of the year.

The coordinated move is aimed at providing U.S. dollars to struggling European banks that need the currency to fund loans and repay debt.

All of the auctions will carry a fixed rate and be conducted as “repurchase operations against eligible collateral.”

The ECB has been conducting weekly dollar swaps since October 2010 and will continue to do so, according to an ECB statement.

5 things to know about Europe’s debt crisis

The euro gained 0.6% against the dollar, and U.S. and European markets surged following the announcement.

U.S. stocks rallied as did European markets. Britain’s FTSE 100 (UKX) gained 2.2%, the DAX (DAX) in Germany added 3.6% and France’s CAC 40 (CAC40) rose 4.1%.

European banks also soared on the news. Shares of BNP Paribas spiked 14% in Paris trading. Credit Agricole and Societe General jumped 7.7% and 7.3% respectively.

U.S. banks also rose, with shares of Bank of America (BAC, Fortune 500), JPMorgan Chase (JPM, Fortune 500), and Goldman Sachs (GS, Fortune 500) all gaining about 2%.  To top of page

Article source: http://rss.cnn.com/~r/rss/money_topstories/~3/EsIu3QWLfW0/index.htm

Leave a Reply

WP2FB Auto Publish Powered By : XYZScripts.com
Bunk Beds