Market Thrilled by Joint Easing Measures

Risk appetite improved as 6 central banks jointly issued a statement pledging to enhance liquidity support to the global financial system. The FED, ECB, BOE, BOJ, BOC and SNB agreed to cut, effective from December 5, 2011 to February 1, 2013, the price on the existing temporary USD liquidity swap arrangements by -50 bps, to the USD OIS+50 bps. As indicated in the statement, the aim of these actions is' to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity' while the FED affirmed that ‘US financial institutions currently do not face difficulty obtaining liquidity in short-term funding markets'.

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Market Thrilled by Joint Easing Measures