Financial institutions gain better access to dollars by “temporarily” exchanging their US treasury bills for green notes.
The US Central Bank put in place a new device on Tuesday that allows foreign central banks, in particular, to have easy access to dollars by “temporarily” exchanging their US treasury bills for green notes, according to a press release from the Fed.
This new device – which also concerns other unspecified international financial institutions – should facilitate transactions on the US government bond market and is part of massive Fed interventions to guarantee access to credit for businesses. and to households in an economy hit hard by the impact of the Covid-19 pandemic.
The device, managed by the New York Regional Central Bank where these financial institutions must have an account, will be operational from April 6 and for a period of at least 6 months, said the Fed.