The Federal Reserve said Thursday it will extend its currency exchange program to other central banks around the world as the demand for dollars intensifies.
In addition to its existing arrangements with its larger peers, the Fed is now extending the lines to Australia, Brazil, Denmark, Korea, Mexico, Norway, New Zealand, Singapore and Sweden. The lines are known as dollar swaps and will be in place for six months.
The Fed will provide $60 billion to all but Denmark, Norway and New Zealand, which will get $30 billion.
Reserve Bank of Australia, the Banco Central do Brasil, the Bank of Korea, the Banco de Mexico, the Monetary Authority of Singapore, and the Sveriges Riksbank and $30 billion each for the Danmarks Nationalbank, the Norges Bank, and the Reserve Bank of New Zealand.
The U.S. dollar index, which measures the currency against a basket of its global competitors, has risen to a record high amid widespread selling of assets.
"These facilities, like those already established between the Federal Reserve and other central banks, are designed to help lessen strains in global U.S. dollar funding markets, thereby mitigating the effects of these strains on the supply of credit to households and businesses, both domestically and abroad," the Fed said in a news release posted on its site.
The Fed has standing arrangements with the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank.