Bernanke briefs senators on Europe

By Jennifer Liberto, senior writer


WASHINGTON (CNNMoney.com) -- Federal Reserve Chairman Ben Bernanke met with senators Tuesday to talk about the central bank's role in stabilizing the financial markets in Europe.

Over the weekend, the Fed announced what it called a temporary U.S. dollar liquidity swap. The goal of the Fed's program was to help stabilize markets by providing dollars to foreign banks that need the U.S. currency to transact business.

Bernanke briefed senators on the Banking Committee about the plan in a closed-door meeting at a Senate office building, according to a congressional aide.

The concern is that there will not be enough dollars overseas to meet demand, which could unsettle credit markets. The swaps program will begin this week and is scheduled to continue through January.

Bernanke promised transparency in the program and committed to making public contracts between the Fed and other central banks, an aide said. He also promised senators that the Fed will report weekly on the activity in each of the swaps accounts held by the central bank.

Less than two hours after senators left the meeting, they voted 96-0 approving an amendment to the Wall Street reform bill that would require a one-time congressional investigation of loans that Fed made to Wall Street banks during the financial crisis. To top of page

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