Bessent says US allies in Gulf, Asia requested swap lines

[WASHINGTON] US Treasury Secretary Scott Bessent said on Wednesday (Apr 22) that many Persian Gulf allies along with a number of Asian nations have requested foreign exchange swap lines with the US, and pointed to the potential for such arrangements to support US dollar-denominated lending overseas.

“Many of our Gulf allies have requested swap lines,” Bessent said in answering questions at a Senate Appropriations subcommittee, a day after President Donald Trump confirmed that a currency swap with the United Arab Emirates was under consideration. “Numerous other countries, including some of our Asian allies, have also requested them.”

Swap lines have traditionally been set up between central banks, and the Federal Reserve maintains open lines with the European Central Bank, Bank of Japan and a handful of other peers.

Bessent last year pioneered using a Treasury fund to provide a swap line of US dollars to Argentina to help Buenos Aires prop up its currency.

“Swap lines, whether it’s from the Federal Reserve or the Treasury, are to maintain order in the US dollar funding markets and to prevent the sale of the US assets in a disorderly way,” Bessent said. BLOOMBERG