Fed lends $6.64 billion in 'swap' program

[The Northerner]

Source: Associated Press

WASHINGTON – The Federal Reserve says it lent $6.64 billion through a program aimed at easing strains from the European debt crisis.

Most of the money — $6.4 billion — went to the European Central Bank. The rest went to the Bank of Japan.

The Fed is lending much-in-demand dollars to other central banks in exchange for their currencies. In turn, the central banks can lend the dollars out to banks in their home countries to prevent the crisis from spreading further.

The Fed's "swap" program was revived in May as fears rose that Greece's debt crisis could engulf other European countries. European banks need dollars to lend to companies across the Continent. European companies that have operations in the U.S. pay their employees in dollars and buy raw materials with the U.S. currency.

Read more: http://news.yahoo.com/s/ap/20100603/ap_on_bi_ge/us_fed_europe