The use of swap lines are coming into play

Euro area banks took up $112 billion in dollar funding in a special auction by the ECB today, the most since the 2008-09 financial crisis.

Dollar demand

$75.8 billion was borrowed for 84 days at 0.38% (44 banks bid) while $36.3 billion was borrowed for 7 days at 0.45% (22 banks bid) by European lenders.

Again, this continues to emphasise that funding pressures are far from over but at least the central bank swap lines are helping for the time being.

As mentioned earlier, a funding/liquidity crunch can quickly turn into a credit crunch and that is what everyone is trying to avoid right now. Hence, these measures being taken up.

At the same time, the SNB also saw big demand for its special operations as $2.3 billion was taken up via its 7-day dollar auction and $315 million via its 84-day auction today.