The Monetary Authority of Singapore (MAS) announced on Thursday a swap facility with the U.S. Federal Reserve that will provide dollar liquidity of up to 30 billion U.S. dollars.
"Given the international character of financial markets in Singapore, MAS deems it prudent to join the group of central banks that have established swap facilities with the Federal Reserve," the de facto central bank said in a statement.
It also said it is a precautionary measure to reassure financial institutions in Singapore that they have access to U.S. dollar liquidity. That is because most of the financial institutions here have global operations.
"MAS judges that it is not necessary to draw on the swap facility at this time, but will continually assess the need as global conditions develop," it added.
The U.S. central bank has agreed to provide 30 billion dollars each to central banks in Brazil, Mexico, South Korea and Singapore.
Singapore's swap facility with the Federal Reserve will run until April 30 next year.
The central bank reiterated that liquidity in the Singapore dollar market is sufficient. It added that it will continue to act through its market operations to inject additional liquidity as necessary.
Source:Xinhua
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