Fed to Lend $200B More to Ease Market Strain

NEW YORK -- The Federal Reserve said Tuesday that it would lend up to $200 billion of Treasury securities to help ease the strain on the credit market, The New York Times reported.

The Fed will lend the money for 28 days, instead of the usual overnight period under the existing program, and will accept federal agency debt, federal agency mortgage-backed securities and nonagency triple-A rated securities, the paper reported.

The new program, called the Term Securities Lending Facility, will lend the Treasuries through weekly auctions that will begin March 27, the paper reported.

The Fed also increased currency swap lines with the European Central Bank and the Swiss National Bank, to $30 billion and $6 billion. That is an increase of $10 billion for the European Central Bank and $2 billion for the Swiss bank, the paper reported.

-- NYSSCPA.org News Staff

Posted on 3/11/08