Fed Doubles Amount It Plans to Lend to Bolster Credit Market

Washington, D.C.–Several of the world’s central banks–including the U.S. Federal Reserve–have announced a joint plan to add liquidity into money markets in North America and Europe, the Financial Times reports.On Friday, the Fed made an emergency intervention to reduce credit market strains. The Fed said this week that it would double the amount it originally had offered to lend, increasing the total by $200 billion. The money will be loaned to banks and primary dealers or brokers who trade with the Fed, which hopes it will be given to hedge funds and other market members who are having a hard time raising capital.The Fed also will augment its currency swap arrangements with the European Central Bank and the Swiss National Bank–which have been extended through late September–by $10 billion and $2 billion.