The European Central Bank (ECB) intends to expand its ties to foreign central banks, making it easier for them to borrow euro in a crisis, Reuters reported Monday. ECB president Christine Lagarde told European lawmakers this would take the form of swap lines, a form of emergency liquidity that allows central banks outside the Eurozone to borrow euro against their own currency. “We will be working on swap lines that will be more responsive to the imperative of having a sovereign euro area and a strong euro,” Lagarde said. These can not only relieve pressure on foreign banks but also safeguard the eurozone from outside shocks by ensuring euro-denominated loans can be repaid.
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