World central banks have taken unprecedented action to flood money markets with dollars in an effort to stop the financial system freezing.
The US Federal Reserve led the charge to relieve 'elevated pressures' in global markets by offering $180 billion and promising more.
Central banks have now spent more than $600 billion this week to avert a global system failure. In addition, the Fed rescued US insurance titan AIG with $85 billion, having allowed Lehman Brothers bank to fail.
The Fed was joined by the European Central Bank with the British, Japanese, Swiss and Canadian banks in offering to swap currencies for dollars, taking the total to some $300 billion on offer.
The US Treasury also announced plans to raise $100 billion by issuing new debt to help support the Fed's actions.
The Fed's joint efforts with the other central banks would 'address the continued elevated pressures in US dollar short-term funding markets,' according to a statement.
Since the credit crunch began 14 months ago, distrust about the quality of assets being offered as collateral has spread through the money markets where banks obtain short-term funds.
The resulting drying up of liquidity became a drought this week with the demise of Lehman Brothers, the last-minute rescue of fellow Wall Street giant Merrill Lynch and the de-facto nationalisation of insurance giant AIG.
As a result, central banks have had to fulfil their traditional role as the lender of last resort, making billions available for banks to borrow to satisfy their overnight financing needs.
Meanwhile, US President George Bush today said he was concerned about the financial markets and the US economy, which were trying to absorb the US government's 'extraordinary measures' to shore them up.
In his first remarks on the financial crisis since the rescue by US authorities of insurance giant American International Group, he said the recent efforts by his administration and the Federal Reserve were necessary moves.
