BoE amends schedule for 7-day US dollar repo operations
25 April 2023 UK
Image: Leonid_Andronov/stock.adobe.com
The Bank of England (BoE) has made changes to seven-day US dollar repo operations, which will commence from 1 May 2023.
Seven-day US dollar liquidity-provision operations will revert from daily to once per week, with operations expected to run on Wednesdays.
This change comes in light of improvements in US dollar funding conditions and the low demand at recent seven-day maturity US dollar liquidity-providing operations. The BoE, the Bank of Japan, the European Central Bank and the Swiss National Bank, in consultation with the Federal Reserve, will enact operational changes from 1 May 2023.
Alongside this update, the UK central bank will also revert from daily to weekly seven-day maturity operations which provide liquidity via the standing US dollar liquidity swap line arrangements.
The swap lines among central banks are available standing facilities and serve as an important liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the effects of such strains on the supply of credit to households and businesses, domestically and abroad.
The update follows an announcement from a number of central banks in March that have started to unwind temporary changes to their liquidity-providing operations, through the US dollar liquidity swap line and repo operations, introduced in response to the Credit Suisse Group crisis.
The BoE says it continues to stand ready with other central banks to re-adjust the provision of US dollar liquidity as warranted by market conditions.
Seven-day US dollar liquidity-provision operations will revert from daily to once per week, with operations expected to run on Wednesdays.
This change comes in light of improvements in US dollar funding conditions and the low demand at recent seven-day maturity US dollar liquidity-providing operations. The BoE, the Bank of Japan, the European Central Bank and the Swiss National Bank, in consultation with the Federal Reserve, will enact operational changes from 1 May 2023.
Alongside this update, the UK central bank will also revert from daily to weekly seven-day maturity operations which provide liquidity via the standing US dollar liquidity swap line arrangements.
The swap lines among central banks are available standing facilities and serve as an important liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the effects of such strains on the supply of credit to households and businesses, domestically and abroad.
The update follows an announcement from a number of central banks in March that have started to unwind temporary changes to their liquidity-providing operations, through the US dollar liquidity swap line and repo operations, introduced in response to the Credit Suisse Group crisis.
The BoE says it continues to stand ready with other central banks to re-adjust the provision of US dollar liquidity as warranted by market conditions.
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