Europe's Central Banks Pump More Cash Into Money Markets

Europe's central banks offered up more cash to jittery banks recently, putting a combined $90 billion into money markets in a lockstep move aimed at stemming a loss in confidence in the face of a withering global financial crisis. The move, the fourth this week, is aimed at boosting shaky confidence and persuading fearful banks to lend to each other. Banks have been increasingly reluctant to lend to each other as distrust spread throughout the financial system. The European Central Bank, which oversees the 15-nation euro zone, said it would offer up as much as $40B in a 3-day tender while in London, the Bank of England announced a similar move. The Swiss National Bank was taking bids from banks for as much as US$10 billion. The move came a day after the U.S. Federal Reserve plowed as much as $180 billion into money markets abroad and the NY Federal Reserve's action to ease an increase in overnight lending rates by injecting $55 billion into the banking system. Recently, the Fed authorized new swap facilities with the Bank of Japan for as much as $60 billion; $40 billion for the Bank of England and $10 billion for the Bank of Canada. All told, Fed action increased lines of cash to central banks by $180 billion to $247 billion.