It was announced today that a temporary network of bilateral liquidity swap lines between six central banks will be made into a standing arrangement "until further notice". The six central banks are listed below, with links to the press releases on their websites:

• Federal Reserve
• Bank of England
• European Central Bank
• Bank of Japan (PDF)
• Swiss National Bank (PDF)
• Bank of Canada

The original temporary agreements, made in December 2007, were an emergency measure to ease financial turmoil by boosting liquidity. When the original agreements expired in early 2010, similar sets of agreements were introduced between mid-2010 and late-2011, eventually incorporating all six central banks mentioned above.

Making these arrangements permanent will provide a "prudent liquidity backstop" as a bulwark against future financial crises.

More information on the existing central bank agreements, including explanations of the mechanics of the swaps, can be found by clicking this way FRB: Central bank liquidity swaps.

-Ben L.