ECB, BoE to pump extra cash into strained money markets

The Wall Street Journal reports European central banks will pump extra cash into strained money markets Monday morning. With interest rates on the overnight loans that euro-zone banks make to one another climbing, the ECB said early Monday it will inject extra overnight funds into markets. The ECB "stands ready to contribute to orderly market conditions," the central bank said in a statement. Euro-zone banks will submit bids for an undetermined amount of central bank funds later this morning. The Bank of England said it will offer 5 bln pounds ($9.87 bln) in extra 3-day funds. The Swiss central bank said it would take similar steps if necessary. European governments also sought to reassure jittery markets Monday morning. French Finance Minister Christine Lagarde, speaking on French radio Europe 1, asked French and European banks not to panic, saying "mechanisms" to prevent any destabilizing of European financial markets have been put in place. She didn't elaborate. Germany's Finance Ministry, banking regulator BaFin and the German central bank also said they were in close contact with their international partners and German banks.