WASHINGTON : The US Federal Reserve pumped 5.25 billion dollars into the banking system Wednesday, the third consecutive daily injection this week aimed at easing a credit squeeze. The Fed has injected a total of 134.25 billion dollars into the financial system since August 9 in a bid to boost credit flows which have seized up due to problems linked to the distressed US mortgage market.
Wednesday's action was announced by the Federal Reserve Bank of New York, which oversees such operations for the Washington-based Fed. The bank injected two billion dollars Tuesday and 9.5 billion Monday.
The US central bank typically buys billions of dollars worth of securities from major banks, pumping extra cash into the banking system, which the banks are obliged to repurchase at a later date.
- AFP /ls
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