Dollar liquidity transaction offerings: stop in July
The world’s major central banks, including the SNB, have agreed to discontinue the provision of US dollar liquidity with an 84-day maturity
The European Central Bank, the Swiss National Bank, the Bank of England and the Bank of Japan, in concert with the Federal Reserve, have agreed to cease offering liquidity operations in U.S. dollars with a maturity of 84 days.
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This is justified in light of the continuing improvement in financing conditions in the US and the weak demand from recent liquidity-providing operations in this currency.
This change will apply from July 1, 2021.
The auction calendar until June 30, 2021, which has already been published, remains unchanged.
Seven-day expiring weekly trades preserved
Weekly seven-day maturity operations will continue to be offered after July 1.
These central banks are prepared to make adjustments to their U.S. dollar liquidity provision operations depending on market conditions, including restarting those with 84-day maturities.
Agreement between the FDF and the SNB of 29 January 2021 (in Italian)
Explanations of the agreement between the FDF and the SNB of 29 January 2021 (in Italian)
Allocation of the Swiss National Bank’s net profit to the cantons
The swap agreements in place among these banks are permanent schemes that serve as an important safety net (“liquidity backstop”) to ease tensions in international funding markets, helping to mitigate the effects of those tensions on lending to households and businesses at home and abroad.
