Fed moves to keep finances flowing

WASHINGTON, Sept. 18 (UPI) -- The U.S. Federal Reserve moved to keep financial streams from choking Thursday, expanding swap lines to allow banks to borrow at lower rates.

The Fed authorized $180 billion to free up an additional $110 billion for European banks, $60 billion for the Bank of Japan and $10 billion for the Bank of Canada, The Washington Post reported.

A $60 billion swap line was established with the Bank of Japan and $30 billion for the Bank of England, The New York Times said.

"Central banks are showing decisive leadership here as risk aversion is hitting the private sector," Julian Callow, chief European economist at Barclays Capital told the Times.

Central banks in Australia, India, the Philippines, and South Korea moved to restore calm in markets Wednesday after the collapse of Lehman Brothers Holdings Inc., the sale of Merrill Lynch and the rescue of American International Group put markets in a tailspin.

In Russia, President Dmitry Medvedev committed $20 billion to prop up Russian stock markets, partially closed after sharp declines.

On Wall Street, attention has shifted to Morgan Stanley, Goldman Sachs and financially strained Washington Mutual. In England, the sale of its fifth largest bank, HBOS, was confirmed, the Times reported.