Bank of Canada Announces Extension of Expanded Swap Facility with U.S. Federal Reserve

The temporary reciprocal currency arrangements (swap lines) between the U.S. Federal Reserve and other central banks have been extended to 1 February 2010.

The extension applies to both dollar liquidity swap arrangements and foreign currency swap arrangements between the Federal Reserve and other central banks.

Bank of Canada Action

The Bank of Canada and the Federal Reserve have agreed to extend their expanded US $30 billion swap facility (reciprocal currency arrangement) to 1 February 2010. This expanded swap facility, originally announced on 29 September 2008, was set to expire on 30 October 2009.

The Bank of Canada continues to judge that it is not necessary for it to draw on this swap facility at this time, but that it is prudent to maintain the agreement. Should the swap be drawn on, the details of the liquidity facilities provided would depend on the specific market circumstances at the time.

The Bank of Canada continues to closely monitor global market developments and remains committed to providing liquidity as required to support the stability of the Canadian financial system and the functioning of financial markets.

For further information, please contact:
Jeremy Harrison
613 782-8782