The news is here:
The response from Globex:
that response extended even higher (see the chart in this post)
The long story short is that the Federal Reserve and the
- European Central Bank
- Bank of England
- Bank of Japan
- Bank of Canada
- Swiss National Bank
will offer seven-day dollar loans to their banks starting on Monday.
The central banks listed above currently offering US dollar operations have agreed to increase the frequency of 7-day maturity operations from weekly to daily, The daily auctions will be held at least through the end of April. What this means is that any big bank operating globally that can post good collateral at these banks can get US dollars from its central bank (the ECB, BoE, BOJ, BoC, and SNB get their dollars from the Federal Reserve) any day of the week.
This is a positive for sentiment. I should say also that it does signal how deep the concern runs amongst global authorities over the recent turmoil in the financial system. US banks and CS are the triggers of this.
So, the BOJ (or any of the others) borrow USD from the Federal Reserve and repay that loan 7 days later (or roll it over) is what this 'swap' means.