The European Central Bank said it will lend dollars to euro-area banks in a series of three-month loans as the region's debt crisis limits market access to the U.S. currency.
The Frankfurt-based ECB said it will coordinate with the Federal Reserve and other central banks to conduct three separate dollar liquidity operations to ensure banks have enough of the currency through the end of the year. The three-month loans are in addition to the bank's regular seven-day dollar offerings and will be fixed-rate tenders with full allotment, the ECB said in a statement today. They will be offered on Oct. 12, Nov. 9 and Dec. 7.
The euro jumped more than a cent against dollar after the announcement and traded at $1.3854 at 5:14 p.m. in Frankfurt. Stocks rose and Treasuries fell, pushing 10-year yields up the most in more than three weeks.
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