US Federal Reserve

Will auction loans to banks, accepting a broader range of collateral than before and will enter into foreign exchange swap agreements with the European and Swiss central banks to tackle the shortage of dollar funds in Europe

The Fed's open market operations have controlled the overnight federal funds rate but not the high rates for loans made for up to a few months by one bank to another. Although banks can, in principle, borrow directly from the Fed through the discount window, many fear the stigma of doing so

The Federal Reserve will initially auction $20bn on Monday for 28 days and accept wider collateral that it usually accepts only at its discount window, where interest rates are currently half a percentage point above its target rate of 4.25 per cent. The currency swap arrangements with the ECB and SNB will provide $24bn of dollars to continental European central banks

European Central Bank

Will provide dollar liquidity which it had previously rejected as unnecessary

The ECB will conduct two dollar-denominated auctions, starting next week for European banks which are short of dollars. Up to $20bn dollars will be provided by the Fed through a currency swap. The ECB will accept euro-denominated collateral from the banks for the dollars, for which it will charge a small fee

Bank of England

Will conduct bigger auctions, accept a far wider range of collateral than before and drop the penalty rate

In a big shift from its previous position, the Bank will increase its scheduled auction next Tuesday from £2.85bn to £11.35bn, with £10bn of these funds allocated for three months. For the first time, it will accept mortgage-backed securities, covered bonds and dollar-denominated securities

Unlike the September auctions, when banks eschewed its three-month money, the Bank will auction the cash without a minimum interest rate of 1 percentage point above its official rate of 5.5 per cent. It is following the ECB's method of expecting a penalty rate to come from the bids for the money

Swiss National Bank

In addition to its Swiss franc open market operations, the SNB will offer dollar-denominated auctions

The SNB will offer $4bn in a dollar-denominated auction next week, which it said would "facilitate the US dollar funding of SNB counterparties in the Swiss repo system." It may conduct further dollar-denominated auctions. As in the case of the ECB, the Fed will provide the dollars in a currency swap

Bank of Canada

Will expand the range of collateral it will accept

The Bank of Canada will buy at least C$3bn of term securities, accepting a wider range of collateral than before, including will some types of asset-backed, bank- sponsored commercial paper and US Treasuries

l