Central Banks Move to Calm Fears
Markets Rally After Joint Action Aimed at Cushioning Global Effects of Euro Crisis; Fed ‘Prepared’ to Do More if Needed
By JON HILSENRATH And JEFFREY SPARSHOTT
Is the move by the Fed, ECB and other central banks to help shore up global economies more substance or more symbolic? WSJ Chief Economics Correspondent Jon Hilsenrath checks in on Mean Street to discuss. (Photo: Getty Images)
The world’s major central banks launched a joint action to provide cheap, emergency U.S. dollar loans to banks in Europe and elsewhere, a sign of growing alarm among policy makers about stresses in Europe and in the global financial system.
The coordinated action doesn’t directly address Europe’s government-debt and budget woes. Instead, it is aimed at alleviating the impact of those troubles on global markets. Moreover, it highlights the possibility of other steps by central bankers if markets or the global economy deteriorate.