September 18, 2008 / 7:37 AM / 9 years ago

Bank of Canada details swap agreement with U.S. Fed

LONDON (Reuters) - The Bank of Canada said on Thursday it had agreed on a US$10 billion swap facility with the U.S. Federal Reserve to provide U.S. dollar liquidity in Canada.

The facility is similar to those announced by other central banks, including the Fed, on Thursday as part of coordinated action to improve liquidity conditions in global financial markets, the bank said in a statement.

The BOC said it judged it was not necessary at this time to draw on the swap facility but said it was prudent to have it in place. The facility will provide it with “additional flexibility to address rapidly evolving developments in financial markets.”

The central bank added that it continues to closely monitor developments in global markets and is committed to providing liquidity as required.

Reporting by Jessica Mortimer

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