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World's Central Banks In Common Move To Ease Market Strains

The U.S. Federal Reserve is one of the central banks taking part in the operation.
The world's major central banks have moved to make it easier for banks to get dollars if they need them, in a coordinated effort to reduce the strains on the global financial system.

Stock markets rose sharply on the move. The European Central Bank (ECB), the U.S. Federal Reserve, the Bank of England and the central banks of Canada, Japan and Switzerland are all taking part in the operation, which is designed to "enhance their capacity to provide liquidity support to the global financial system."

The ECB said in a statement that the central banks have agreed to reduce the cost of temporary dollar loans to banks -- called liquidity swaps -- by a half percentage point.

The new, lower rate will be applied to all central bank operations starting on December 5.

Stocks surged following the news.

compiled from agency reports