Central Banks Continue Campaign to Reassure Financial Markets
By VOA News
13 August 2007
Major central banks continued their campaign to reassure financial markets Monday, after worries about a credit crunch caused dramatic drops in stock prices in volatile trading last week.
The latest effort is by the European Central Bank, which made another $65 billion available Monday. The ECB, the U.S. Federal Reserve, Japan’s central bank, and other institutions have together injected more than $300 billion into the financial sector over the past few days.
European stock indexes rose strongly Monday while Japanese share prices were slightly higher at the close of trading.
Stock prices had fallen dramatically around the world last week over concerns that losses in the U.S. “sub-prime” mortgages would force banks to curtail credit. Investors worried that less lending would hurt economic growth and profits.
The central banks are boosting access to credit by increasing the amount of money available for lending.