ECB and Bank of England activate currency swap arrangement

The European Central Bank (ECB) and the Bank of England have decided to activate a standing swap line through which the Bank of England will offer to lend euro to UK banks on a weekly basis. The ECB will receive pound sterling from the Bank of England in exchange for euro. The activation marks a prudent and precautionary step by the Bank of England to provide additional flexibility in its provision of liquidity insurance, supporting the functioning of markets that serve households and businesses.