Fed extends dollar funding to more central banks

The Federal Reserve has launched a new repo facility designed to provide dollar liquidity to foreign central banks in an effort to broaden dollar operations beyond its swap lines.

The temporary repo facility for foreign and international monetary authorities – or FIMA – will allow central banks to borrow US dollars against Treasury collateral.

Global US dollar funding pressures increased following the outbreak of the coronavirus, prompting the Fed to expand the ability for some central banks