The Federal Reserve Board published a staff FEDS Note surveying how central banks provide standing liquidity on demand and intraday credit, benchmarking foreign arrangements against the Federal Reserve’s discount window. The note maps facilities at eight foreign central banks into four functional categories and highlights common design features and key points of divergence in how authorities separate routine backstop lending from stress and emergency support. The framework distinguishes intraday liquidity, business-as-usual overnight liquidity, stress-related temporary liquidity and Emergency Liquidity Assistance (ELA). For the United States, it summarizes the discount window’s primary, secondary and seasonal credit programs and intraday credit, including that primary credit is generally available on a no-questions-asked basis to sound depository institutions, priced at the top of the federal funds target range and offered for terms up to 90 days, while secondary credit is typically overnight at rates above primary. Across the Reserve Bank of Australia, Banco Central do Brazil, Bank of Canada, European Central Bank, Bank of Japan, Banco de México, Sveriges Riksbank and Bank of England, all provide intraday liquidity separately from other lending and have some form of ELA, but designs differ materially in the intermediate space, disclosure practices and treatment of end-of-day negative balances. The note also frames facility design choices around the trade-off between stigma and moral hazard, and notes that terms typically become broader in collateral, more punitive in pricing, longer in tenor and more discretionary as lending moves from routine operations toward ELA, while U.S. programs differ from typical foreign approaches through supervisory-eligibility based access and statutory transaction-level disclosure with a two-year lag.
Federal Reserve Board 2025-02-26
Federal Reserve Board staff publish global comparison of discount-window-style liquidity facilities and intraday credit
The Federal Reserve Board released a staff FEDS Note comparing central banks' standing liquidity and intraday credit provisions, benchmarking foreign arrangements against the Federal Reserve's discount window. The note categorizes facilities at eight foreign central banks and highlights differences in routine and emergency lending, disclosure practices, and end-of-day balance treatments. It also discusses the trade-off between stigma and moral hazard, noting that U.S. programs differ in supervisory-eligibility access and disclosure.